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Modular home building growing amidst new home construction shortage

Modular Home Building
Posted at 8:21 AM, Apr 25, 2022
and last updated 2022-04-26 10:34:30-04

GOODFIELD, Ill. — With continued supply chain delays and labor shortages, demand for new home construction over the past two years has drastically outpaced supply. But one slice of the industry that is seeing big business is modular home construction.

“We are in the future of construction building, whether it's residential or commercial real estate,” said Royce Schieler, production manager for modular home builder Homeway Homes.

Inside their 60,000-square-foot factory in central Illinois, the Schieler family is building homes one room at a time.

“The pieces consist of a floor assembly wall and a ceiling system,” said Bob Schieler, sales manager for Homeway Homes.

The modular homes are built in sections or modules.

“We start building the floor, and then we crane that up and fly it over with our cranes and put it online,” said Royce.

They are then moved from station to station, a sort of home-building assembly line.

“Electrical, plumbing, drywall, painting, flooring, cabinets trim. Everything's pretty much complete when it's finished about 95%,” said Bob.

Eventually, the modules are shipped to the lot and put together like LEGOs, directly on the foundation. To do that, they reinforce the structures with specialized glue.

“This is a foam glue and it's we sprayed on and then it hardens, and this stuff is hard. And what this does for us is because we have to move modular - pick them up - this adds so much more strength all the way down the stud,” said Royce.

“All right, so this is our Camden model home. It's a three-bed, two-bath home. Very open concept design,” said Bob.

Constructed to code and fully inspected. Inside, they’re indistinguishable from traditionally built homes.

One of the biggest cost savings comes from the speed at which these “factory-built” homes can be completed, between 30% and 50% faster than homes built on-site.

“There are no weather delays when we're building indoors. So that is the advantage we can build all year round and not be affected by any of that,” said Bob.

Homeway Homes shifted from building traditional on-site homes to exclusively focusing on modular construction about 17 years ago.

At any given time, they're building about six to seven homes inside this construction facility, and they're completing about one-and-a-half homes per week.

When they used to construct on-site, they could only build about 12 homes a year.

“Four hundred percent more construction can be built out of a facility like this than on-site,” said Royce.

The global modular building market grew from $72 billion in 2020 to nearly $76 billion last year. It’s forecast to grow to almost $115 billion by 2028.

States are taking notice. In Colorado, a new bill calls for $40 million in grant funding to be dedicated to innovative housing, like modular homes.

“Time is money. And yeah, you can definitely save some money on modular construction,” said Bob.

On Chicago’s west side, modular duplexes built in off-site factories are helping to create affordable housing by reducing construction costs and shortening completion times to just 90 days.

“That's the beauty of modular, to make it easy and quicker for the homeowner, for the real estate investor to get their job done quick— with quality,” said Royce.