The government is planning new initiatives to build up to 100,000 offsite homes to help tackle the housing crisis.
According to a report in The Sunday Telegraph, a white paper which will be published next month will include measures encouraging banks to lend to offsite home builders.
It is hoped the prefabricated housing push will speed up delivery and lead to major savings through economies of scale and help the government reach its one million homes target by 2020.
While the Department for Communities and Local Government is not expected to set a hard target, government sources said it was hoped that the change would result in more than 100,000 prefabs being built over this parliament.
Despite a number of companies such as Laing O’Rourke and Legal & General entering the offsite arena, the method has failed to gain traction so far in the UK.
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Gavin Barwell, the housing minister, said: “Offsite construction could provide a huge opportunity to increase housing supply and we want to see more innovation like this emulated across the house building sector.”
“The £3bn Home Building Fund will help build more than 225,000 new homes and provide loans for small firms, custom builders, offsite construction and essential infrastructure, creating thousands of new jobs in the process.”
The government is looking at two areas of potential support. First, providing direct funding to help firms build new prefabs and second, convincing risk-averse lenders to give out more loans.
Ministers have visited Accord Group, a housing association in the west midlands, which claims it can produce a three-bedroom house from scratch in a day in its factory.
Pocket, a London-based firm building affordable flats for first-time buyers, has also been visited by Barwell and communities secretary Sajid Javid.
House builders financial model where later phases are funded by earlier sales income doesn’t support investment needed for pre-fabrication. That is why MMC didn’t take off last time – still a cottage industry helped out by Housing Association rent programmes. Now everyone is doing Sales the same problems will arise.
We need to avoid being confused by small-homes and off-site manufacturing.
I have blogged about this: https://stevenboxall.wordpress.com/2015/11/19/housing-issues-and-thoughts-small-homes-and-off-site-manufacturing/
We must be clear about what problem we are trying to solve.
Why does it take a govt white paper to encourage banks to lend to offsite home builders? Not prefabricated but ‘factory engineered’ – exactly like motor cars, computers and televisions for example, in controlled conditions, out of the weather. So what makes it so difficult accepting the same principle for the most expensive purchase most people will ever make?!