What is the definition of affordable housing? According to the US Department of Housing and Urban Development (HUD), affordable housing is generally defined as housing on which the occupants are spending no more than 30% of their gross income.
A lot goes into whether a home can be affordably built. Factors include land value, location, amenities, building code and even whether it’s a duplex, a condo or a single-family home. The list goes on.
But does offsite construction automatically make affordability achievable? Well, maybe. Many on the outside looking in at the industry automatically assume that because it’s built in a factory it must be affordable, but that’s not always true. The misunderstanding is because some people still don’t understand the difference between modular and its factory-built cousin, the manufactured home.
Manufactured homes are built to a particular code: HUD’s Federal Manufactured Home Construction and Safety Standards, along with some accompanying installation standards. Manufactured home companies were trying to create affordable housing, and HUD understood that doing so requires cost cutting. They wanted to make sure those cuts didn’t impact the health and safety of the people who live in those homes.
All other US home construction is subject to the International Residential Code (IRC). When it comes to affordability, the thing about the IRC is that it doesn’t have exceptions that say, “you can skip this section if you are building an ‘affordable home.’” It doesn’t work that way.
In fact, if it is factory built, the code can actually work against affordability because many requirements assume the ineffiencies of site construction and require things that don’t make sense in a factory. For instance, some jurisdictions require that a foam insulation panel be cut and fit around each outlet on an exterior wall. But with factory construction, we can spray foam or caulk around the entire area more easily, more cost effectively and don’t need the extra step and cost of the rigid foam. Why should we be required to do both?
Fortunately, the International Code Council and the Modular Building Institute are working to eliminate this with offsite codes 1200 and 1205. Fully implemented, these will have the effect of giving offsite the construction advantages it deserves.
Affordability also depends on efficiently used land that maximizes density while not sacrificing the desirability of the location for residents. And it depends on what materials are used and how they’re used.
But home affordability isn’t just about initial cost; it’s also about the home’s monthly and maintenance costs. Lowering these costs is one of the benefits of resilient construction, and offsite is resilient construction. The resiliency built in at the factory means lower overall costs, not just in surviving a catastrophic event, but also in the normal wear-and-tear on a house under normal use.
Resilience includes built-in energy efficiency. A home can be built so well in the factory, and for virtually no additional cost, that it’s delivered zero energy ready. That means lower electric bills for everyone, and none for those who add solar panels. The money saved can help offset mortgage costs, making the home more affordable for the long term.
The bottom line is that offsite construction is a tool that can be used to make housing more affordable for all. However, it can’t do it on its own. It takes everyone on the offsite team to design and implement affordability into every project.
If you liked this article, you can follow Ken Semler on LinkedIn, where he offers daily insights and commentary about offsite construction.
