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Can Modular Housing Help Address the Housing Affordability Crisis?

By September 21, 2020Industry News

Two of the benefits frequently touted for off-site construction are its speed and efficiency. By using less time and less waste, industry professionals estimate it can save 10% to 15% on construction projects.

This seems like a natural fit for producing more affordable housing options for prospective home owners, but off-site construction may not always be at the forefront of builders’ minds. So how can it be more widely adopted to help address the nation’s housing affordability crisis?

Eric Holt, assistant professor at the University of Denver, and his team have been exploring how off-site construction fits into affordable housing. Using a HELP Grant from the National Housing Endowment, the team specifically planned to look at how framing methodologies tie into affordable housing and modular housing.

“We initially were going to watch framers put up houses using the different methodologies, but the timing of that was in March as everything fell apart,” Holt noted. So instead, the team analyzed data from other sources — including NAHB, the Structural Insulated Panel Association (SIPA) and suppliers in the pre-cut market — to compile a report on the role modular and panelized construction can play in affordable housing.

Holt will present the findings of this report during a Building Systems Week webinar, titled “The Impact of Modular & Panelized Construction on Affordable Housing,” on Wednesday, Sept. 23, at 2 p.m. ET.

He will also share the work his team has been doing to create a home builder’s guide to off-site construction to help builders navigate the switch from stick-built homes to buildings systems.

“Research shows that you can become more efficient, faster, with off-site construction, and even potentially save money,” Holt observed. “But it requires a cultural shift within the company, the supply chain and even the business model.”

Design, in particular, can be challenging, Holt noted, as not everything from a stick-built environment necessarily translates to off-site construction. Labor is still a challenge in the factory, too, but companies such as Entekra — a Building Systems Council member and 2020 Construction & Design Winner of the Ivory Prize, which focuses on scalable solutions to housing affordability — are looking to close that divide through the use of technology.

“There’s a direct correlation between the cost of something and the lack of productivity,” Gerry McCaughey, CEO of Entekra, noted for the Ivory Prize awards as the primary cause of escalating home prices. “There is so little technology being utilized inside the construction industry despite the fact that we’re now in 2020. And yet the technology exists to build a house before it’s ever built, which is what we do.”

Holt questioned if a more production, technology-oriented mindset could help builders understand the value of off-site construction, and how it can benefit their business and productivity. He looks forward to receiving webinar participants’ feedback to help inform future research.

“We really do want the industry’s feedback on this and what next questions do we need to answer for the industry,” Holt shared. “What are the other challenges they’re experiencing out there? Why aren’t they moving to offsite construction? Is it a stigma about modular getting confused with manufactured housing, or a supply issue?”

Register today to reserve your seat. Visit nahb.org for more information on Building Systems Week.