Modern methods of construction (MMC), modular housing, or simply ‘prefab’. Many different but related terms that seem to be the talk of town in the building and property industry lately. In Australia, prefabricated housing has long been associated with mining dongas and demountable school buildings, making it seem undesirable and unfit for high quality residential housing. But in other markets, including the US and many European countries, prefabricated or ‘industrialised housing’ plays a much bigger role in the delivery of modern, high quality housing supply.  

Is the Australian manufacturing and building sector ready to embrace prefabricated and modular housing? Can it assist to ease housing shortages, rising cost and delivery times? And more importantly for Shelter NSW, can it contribute to addressing the housing affordability crisis? 

As we often repeat, there are no silver bullet solutions to fix our housing system. And the real solutions require structural change, including of tenancy legislation, taxation settings, the planning system, and a culture promoting home ownership at all cost.  But as policy makers and advocates, we are pragmatic. And every little bit helps. So what positive outcomes can we expect from developing modern methods of construction? And what are the challenges? 
 
Modern prefabricated housing is high quality, easy to build and deliver, and lower cost. It reduces construction waste, an important consideration as we move towards a net zero, circular economy. But retrofitting and compliance challenges, cost of land, consumer demand for bespoke design, and lack of standardisation are significant barriers.  

Shelter NSW is a member to the NSW Modern Methods of Construction Taskforce, representing the interests of lower income households to ensure that changes in the property development and building industry deliver benefits to people whose needs are not met by the private market. While construction methods alone will not address housing affordability and shortage challenges, we are keen to ensure they deliver the benefits that they can. 
 
Interested in this topic? CBRE has recently released a podcast, ‘Shifting the dial on Australia’s housing shortage’, exploring the challenges and opportunities of adopting MMC and prefab methods more broadly. Have a listen and tell us what you think!