Can modular housing help fix the crisis in our housing market?

In the UK we have a chronic shortage of new homes. Around another 240,000 homes are required each year for the next decade to keep up with needs. These houses need to be affordable and good quality. From my perspective quality new homes should have low running costs, with minimal heat and power requirements, and offer health and well-being outcomes to the occupiers. Unfortunately, house builders are not building enough – under 150,000 homes a year and the new homeowner is being short changed as very often the build quality is poor. This has lead to the perception that all new housing is poor quality and not value for money. Furthermore, market research suggests that consumers don’t want to buy a new home, preferring to buy a house that has been lived in and all the faults sorts out. Can you imagine that kind of attitude with other consumer goods….sorry I don’t want the latest upgrade on my smart phone, I want to few months I am confident it will work properly and buy a second hand one!

So what needs to happen? The construction sector needs to modernise – issues that need to addressed include low price procurement, value engineering that strips out the functionality, challenges in on site supervision and build quality, and the de-skilling of professions and trades. Various reports have revealed this, and titles like “Fixing our broken housing market” suggest the situation could be better, Sadly, there will be more to come as the findings of the inquiry into Grenfell this spring are released.

The current political and public visibility of a sector that is perceived to be providing poor quality, un-affordable housing and that is un-productive – in other words not able to produce enough new quality housing – creates a perfect storm for change, and change must happen.

Modernising the construction sector requires the industry to embrace digital, off site manufacturing and invest in the new skills required to deploy different construction processes that provide savings in costs, build time and certainty on quality (building performance). I have recently been investigating how off site manufacturing producing modular housing can contribute to these outcomes, here is what I found.

For developers and funders factory-assembled buildings offers precision engineering with performance tolerances and use of innovative materials. Build costs can be cheaper on large schemes and quicker across all schemes; meaning financial returns can be delivered sooner. Build times are quicker as enabling works, such as foundations and services, can be done whilst the order is being processed in the factory. The programme can be controlled. Less time and fewer workers are required on site which means impacts on noise, dust, traffic and general disruption to neighbours can be minimised. The assembly processes on site often means that previously unsuitable sites can be considered for use.

The attractive programme and build cost savings from modular housing, and indeed modular additions like floor increases, should be attractive to social housing providers. However, procurement frameworks need to be inclusive encouraging all types of construction methods, too often such frameworks don’t include modular. The public sector appears to have an aversion to new, innovative approaches. This can confirmed by new entrants like Innerspace who offer both modular housing and modular level extensions, and are struggling to enter existing housing opportunities, even though they have a competitive offer.

Finally, and critically, given the current low consumer confidence in the industry, what are the advantages for the home user? Modular houses can offer more affordable dwellings, not just the purchase price, but the running costs of the homes can be significantly reduced through high thermal efficiency. Indeed, several modular housing providers are that confident about their homes’ performance they offer to pay the heating bills for two or three years. The homes include materials and systems that can support health and well-being: For example, natural ventilation and lighting. The sector also offers choice, allowing the customer to pre-order, customise from a wide selection of designs, and move in months later. This is simply unachievable with traditional build. Furthermore, modular houses are eligible for green mortgages, which are cheaper than standard mortgages, so giving more disposable income for the new home owner.

There are some challenges such as overcoming the huge popularity we have with the terraced house. So the design of new modular housing must appeal to a new generation of occupiers whilst adhering to traditional values and fitting in well within the local environment. Likewise, changing the perceptions of agents is important. That will come as the mass appeal of modular housing will grow through the market understanding of the reliability in design and quality and associated benefits. It is already predicted that in the coming years that modular housing will supply 25% of the new build market, and from what I have seen that will be a good thing!

So modular housing can help fix the crisis in our housing market.

Paul would like to thank Tony Dicarlo from Innerspace and Roger Walker from Cygnus Homes for providing information for this blog.

ecobuild 2018 March 6,7,8th – come and find Paul 

Finding real solutions to the housing crisis will be a key focus of ecobuild 2018. I will be chairing a session on Tuesday 6th March called “Housebuilding – so much more than a number game”. It will ask how we can build more homes, without sacrificing the qualities that make sustainable, durable places. The Offsite District will also showcase the latest technology around modular homes and visitors will able to go inside a full-scale build to see the benefits of modular housing for themselves. Register for your place at ecobuild now – http://ow.ly/2Qyk30i8MJd.

copyright Dr Paul Toyne, February 2018