Monday, March 21, 2016

Build Houses Faster: Innovations in the UK that Speed Construction

From bricklaying robots to factory-built houses, the country is looking for ways to build more homes quickly. This matters to homebuyers and investors.

Will the recent invention of a bricklaying robot - which reportedly can build the exterior walls of an average-size UK home in two days - transform the house building industry? And if so, might it help alleviate the shortage of homes in the country?

Perth, Australia-based engineers recently demonstrated a fully built prototype of this house-building machine, which has the working name Hadrian (Get it? After our wall.). It lays 1,000 bricks per hour, using information fed from a three-dimensional CAD (computer assisted design) programme. A single boom head of the crane-like apparatus applies bricks and mortar to the building foundation.

Typically, traditional building methods require about four months to construct a home from the ground up, and that’s after land is acquired and planning authority approvals are put in place. That can take years, however skilled specialists in joint ventures related to property funds strive to keep those bureaucratic measures to a minimum. The faster the turnaround, the quicker the return on assets.

It remains to be seen if the company succeeds with Hadrian. Building in England is stymied by a shortage of skilled house-building labour, but building materials (including bricks) are harder to source as well. The approximately 150,000 homes built in 2015 fell short by about 100,000 of the number required to help the country catch up with the need created by a fast-growing population. Other ideas are welcome.

Volumetric building is one of those ideas. These are the offsite factory-built homes and building components (such as fully-assembled walls) that have made a dent into the housing shortage over the past decade.

Building research firm BRE unveiled two such modular homes in 2015 - the designs of which originate from Tigh Grain Ltd., a Scottish prefabricator, and Userhaus AG, a Swiss technology non-profit - that promise low costs, an eight-week build time and sustainability features such as tight insulation and rooftop photovoltaic systems. A 50-unit housing development in Scotland will be the first application of the system in the UK, which will be built in a Welsh factory. The homes will cost less than £1,000 per square metre to build.

Volumetric building is not new, however interest seems to be increasing because of the favourable economics. A publication dated 2005 from the National Audit Office, “Using modern methods of construction to build homes more quickly and efficiently,” strongly recommended offsite building. As compared to brick-and-block, open panel and hybrid methods of home construction, the volumetric method wins over the others in terms of on-site construction duration (much shorter) and the time it takes to provide weather tight conditions (reducing damage from rain and snow to the interior). It also significantly requires less on-site labour, which has an important cost savings and mitigates the UK’s current skilled construction worker shortage.

To investors in housing these are critical concerns. Time is money, after all. When real assets such as land funds can achieve a sale more quickly those funds can be reinvested in additional building elsewhere a lot faster.

Building.co.uk, an important industry trade publication, cites several factors that could and likely will encourage off-site building manufacturing. Those include a steady flow of orders to achieve economies of scale; lowest-cost manufacturing (perhaps locating manufacturing in cheaper labour markets outside the UK); and CAD/CAM advances that enable more customised construction (vs. building within a limited number of designs, the proverbial “cookie cutter” approach).

Land is one of the most expensive inputs into the home building enterprise. To make a wise move in any phase of the process – land acquisition, land use approvals, building and estate agent work - the counsel of an independent financial adviser is recommended.

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