The ongoing chronic undersupply of skilled construction labor has spurred renewed interest in off-site construction methods such as modular and panelization. But the shift from traditional construction methods to off-site construction in home building continues to face obstacles. The question is: Does removing barriers lead to accelerated market adoption of off-site methods?
To better understand that question and to help builders overcome hurdles to adoption, Home Innovation Research Labs has been investigating home builders' attitudes to off-site since 2020. Using nationwide surveys deployed in 2021 and 2023, Home Innovation sought to discover the top reasons keeping home builders from using off-site methods and how attitudes may be shifting. In survey results from 2021, the view that on-site building works fine and there's no need to change was the No. 1 reason given by respondents.
In September 2023, amidst changing market conditions, Home Innovation asked builders the same questions in a new survey. The “no need to change” response continued to top the list. Coming in at No. 2 was that the complexity/customization of the builder's new-home designs wasn't suited to off-site methods (45% of custom home and luxury builders selected this as one of their top three reasons, while 26% of production builders did), followed by off-site's lack of on-site adaptability for last-minute changes in the No. 3 spot, and negative homebuyer perceptions of off-site methods in fourth place.
... Because the respondent profiles were very similar, we can conclude that large differences between the two years indicate directionality of a trend. For example, two barriers rose substantially in the ranking during the 2 year period: home buyers not accepting offsite rose from the #4 position to #3. This can be readily explained that the rising interest rates over the past 2 years have put many lower-end buyers out of the market, who are typically younger and have less bias against offsite-constructed homes. This should resolve as entry-level buyers return to the market when interest rates decline. Rising from 7th position to 5th was local logistics issues.
There were also a few that fell in the rankings during the past 2 years: the barrier of adopting offsite as a major time commitment fell from the 11th place to 9th place —understandably because many builders’ production volume has declined over the past 2 years and allowed them to adopt construction practices they have previously avoided.
Read more about the research findings
