10 Reasons Why Your Next Home Will Be Built In A Factory
A primer on modular housing
by Scott Kohea
Technology is combining with real estate property to create an exciting sector known as ‘Proptech’. This sector is witnessing many advancements that improve our built environment, and particularly, in the way homes are built. This primer on modular housing provides the top 10 reasons why your next home will be built in a factory.
But first, modular housing defined: A modular home is simply a home that is majority built off-site, as opposed to on-site. These homes are often called factory-built, system-built or prefab (short for prefabricated) homes. Modular and manufactured or mobile are not the same. Manufactured and mobile homes are not placed on permanent foundations, whereas modular are permanently affixed. Modular is built to meet city, state, and federal building codes as opposed to simply HUD or motor vehicle agency requirements. Modular homes have come and gone in various forms through the years, and appear to be here for good this time around.
Now the top 10:
Cost Savings — Housing costs seem to be top of mind for many, and particularly for millennials and generation Z as they are estimated to spend over one-half of their gross earnings on rent during their first decade of work. Construction costs come down an estimated 25% when built inside of a factory, delivering significant savings to buyers and renters.
Time Savings — Today’s consumers expect things to happen quicker than in the past, and waiting several years for a home to be built is not feasible today. The construction time to build can be cut by 50% or more when moving indoors with automation and assembly line methods.
Consumer Preferences — Millennials make up the largest buyer and renter segment and are opting for smaller homes to coincide with their mobile lifestyles and smaller families. This leaves more of their time and money towards experiences and freedom. Factories are far more efficient at building smaller home units than traditional construction.
Sustainability — Along with the flexible lifestyles, more consumers are demanding transparency and solutions towards living more responsibly. Factory built homes are 90% more sustainable and result in less construction waste while being built and lower energy demands while in use. A factory line may have a dustbin of waste at the end of a day, as opposed to a dumpster with on-site.
Quality — Building homes out of wooden 2 X 4’s with hammers and nails relies on craftsmanship and often leads to a lot of cut corners. Machine automation delivers greater than 1/32nd of an inch precision and is able to deliver quality throughout with superior materials.
Workforce and Safety — A standard built home requires a local workforce with trades and supply chain to complete every step of the construction process. However, people are opting for safer and more rewarding work environments and have left the construction trades. A factory improves safety conditions and returns workers to home building with a more predictable working atmosphere.
Flexibility — A factory-built home is structurally sound and can be easily transported. It can also be combined or stacked with other factory-built homes like lego pieces. This creates a ‘forever home’ concept with flex space design and flex location. Although these homes are fixed in place, they can be unbolted and removed if needed.
Design — Modular homes can be professionally designed and finished as costs are spread throughout multiple units. What may be out of reach for traditional home buyers to engage top design talent is more accessible with factory automation.
Strength — Modular homes can be built with a variety of materials, with stainless steel as a preference. This is a renewable and recyclable material with superior strength to alternative structural materials.
Globalization — Other countries have been on the cutting edge of innovation and have fully embraced modular homes as the standard. This includes Japan, Sweden, Singapore, and England. The US market will need to embrace this or expect new entrants.
by Scott Kohea
