A recent symposium was held at the Urban Institute. Entitled “Reimagining Housing: Closing the Equity and Supply Gaps,” industry professionals gathered to discuss the current state of the home building industry.
Specifically, many wondered, even going to the point of being baffled that in this day and age —with 2020 quickly approaching—why we still seem to be so adamant about sticking to the same old home building standards.
It must be pointed out the industry’s continued reliance on the classic model of site-built construction versus off-site construction simply doesn’t add up. Pointing to the proverbial elephant in the room, the issue was raised that although modern technology has indeed advanced the process of site-built construction, it is still leagues behind the time and cost-efficiency offered by the off-site construction model.
Among the central topics discussed at the forum were the tremendous benefits of off-site construction, as well as the trio of obstacles that this model of building faces currently regarding its expansion of use in the United States.
In order to showcase its advantages, Gerry McCaughey, CEO of the off-site construction company Entekra, used the analogy of car buying, pointing out that one wouldn’t want a car dealership to ship their new car in parts to your driveway and have workers come by your house for weeks to put it together. Along this vein, off-site construction uses industrial-size machines that can quickly replicate home parts, reducing the need for manual laborers, therefore drastically reducing costs and time needed to complete building.
Offering a concrete and hard data example, Entekra compared its factory process building prefabricated (or “kit”) homes with the stick-built method, resulting in a three-fold increase in labor productivity. Added to that, the Manufactured Housing Institute now claims that it costs less than half the cost of a site-built home to build an off-site home.
The trio of obstacles currently facing off-site construction in the U.S. was listed as fluctuating demand, consumer preferences still remaining loyal to the traditional site-built homes, and restrictive zoning and expensive financing.
Regardless of how we face these obstacles, it is clear that off-site building can help our nation tackle the current affordable housing crisis. However, in order for this to be possible, policymakers and industry leaders must come together as one united front moving forward.