Future Trends: Will Everyone Soon Build Homes Along Factory Lines?

If all the grand plans and promises of half a dozen house builders come to fruition soon, the UK will be constructing 14,000 homes every year either partially or wholly in factories.

This is an astonishing figure which a few years ago would have been inconceivable. It’s part of a global trend; according to one US report the number of modular homes being built every year around the world will hit 1.1 million next year.

But despite encouraging growth in the UK, it is not enough. The government wants the housing industry to build 300,000 homes a year and although capacity has been increasing, it’s still at least 100,000 homes a year behind the target.

Billion-plus boost

To give the sector a boost, last spring the government revealed it was spending £1.2 billion through its Home Building Fund to initiate multiple projects across the UK featuring modular homes. This in turn has sparked private investment in off-site construction.

And whether it’s complete modular homes pre-made and slotted into place on site, prefabricated panel systems, or made-to-order kitchen and bathroom ‘packs’, it is clear that automation is spreading through the industry.

It has many names including kit, prefabricated and modular homes as well as ‘room packs’. But they are all forms of the same thing; the partial or complete pre-construction of homes off site.

Millions of pounds have – and continue to be – spent by several of the UK’s largest house builders such as Weston Group and Berkeley Group on huge new facilities, alongside several recently-launched pioneers.

At a glance

  • Part and whole construction of homes off-site will reach 14,000 by next year.
  • Two of the UK’s largest volume builders have recently completed huge off-site construction factories.
  • The government has promised to spend £1.2 billion on new technologies for house building.

Tech’s taking off

The technology has enabled finances services giant Legal & General to become a volume house builder almost overnight at its 550,000 sq ft factory in Selby near Leeds, and enabled several other smaller start-ups to gain a foothold– as Dealmakerz reported recently – including Etopia.

“We are really pleased with what we have achieved so far by bringing the best of the best from a range of industries; design consulting, automotive, aerospace and construction together to develop a fantastic product range and the capability to manufacture thousands of beautiful homes every year,” says Rosie Toogood, CEO of Legal & General Modular Homes.

“We have pioneered a new way forward for the housing sector.”

Legal & General will eventually build 4,000 modular homes a year at the factory, which has been busy recruiting 400 staff as it scales up.

Thousands of homes

The most recent plant to begin construction is Berkeley Homes’ riverside facility in Northfleet, Kent which by July next year will be producing 1,000 modular homes a year, something the company hopes will both drive its growth and help solve the housing shortage.

Being built on the 160,000 sq ft site of a former power station, it will employ 145 staff.

“We’ve been experimenting with modular construction for the past ten years,” says the company’s chairman Tony Pidgley .

“I’ve wanted to ensure that it worked and the best test of any product is the home-buying public. We’ve already test-built modular homes all over the UK and, although technology is moving at a hell of rate, we’ve got to be sure it does what we all want.”

But all this tech doesn’t deliver cost savings. Pidgely says his experience is that traditional and modular homes cost the same to build, which he hopes to change once the economies of scale kick in.

They do deliver higher quality homes and more reliable construction. For example, modular factories don’t have to shut down when it snows.

Modular homes

“I’ve wanted to ensure that modular homes construction worked and the best test of any product is the home-buying public.” – Tony Pidgely, Berkeley Group Chairman

Packs a punch

Another big player investing in pre-made components is the Weston Group, which is pre-fabricating entire room packs to each customers’ specification at a new facility officially opened last week in Braintree, Essex.

It will build components for up to 5,000 homes a year but is not a modular factory like Legal & General’s.

“On a personal note I’m not necessarily a great believer in modular construction although in certain sectors of the industry it works for example student accommodation,” says its CEO Bob Weston.

“Then I get it, but if you’re trying to do high density inner city regeneration it’s very difficult to make standard modules work so therefore we tend to stay off modular construction.”

Weston also says it’s not always easy to get planning permission for modular-based developments, and that many planners need to be persuaded to allow standard modules, “which is the first thing you have to hit your head against until it hurts,” he says. “Also, modular construction doesn’t always suit high-density urban regeneration projects.”

Facilities like the Weston Group’s new site in Essex aren’t always about house building, either. The company says its factory is also about copying the distribution systems that the big supermarkets have adopted, with regional distribution centres being fed by food suppliers which in turn feed the produce and products out to the nearest stores.

Weston Group wants to emulate this and switch from suppliers delivering their products to sites to regional RDCs or assembly centres like the one in Braintree, which in turn farm them out to the relevant development sites.

“Above all it means I can control the supply chain and stop empty lorries driving around the UK a lot of the time,” says Weston.

£100,000 house

The most recent company to join the modular fray is Ilke Homes. Its factory in Flaxby, Yorkshire was opened by the Secretary of State for Housing James Brokenshire just before the end of last year, a facility that will soon be building 2,000 family homes a year.

“Our goal is to use the repeatable disciplines of manufacturing to drive productivity improvements in the future and create high quality jobs that don’t rely on hard-to-find construction skills,” says CEO Bjorn Conway.

Buyers are also becoming more accepting of homes built off-site in factories. Ilke Homes won a Sunday Times Readers’ Choice award recently for its 100 House, a modular home that costs just £100,000 to build, a design that Conway describes as “fit for the future”.

And increasingly, it’s a future that house builders of every size will have to embrace.


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