House builders and minister eye off-site to tackle housing shortage

Leading clients and housing minister say factory-built homes could transform the market

A big shift towards factory-built homes is set to transform the housing market, leading clients have said, as the minister in charge of the sector revealed institutional investors stand ready to fund the push into modular construction.

Top housebuilder Crest Nicholson and financial services firm Legal & General (L&G) revealed the scale of their flat-pack housing ambitions at a conference organised by BD’s sister title Building last week.

Housing minister Gavin Barwell told the magazine that attracting and using institutional investors’ cash will be a key part of the government’s white paper on delivering 1 million new homes by 2020, to be published next month.

Crest Nicholson chief executive Stephen Stone said the housebuilder plans to build up to 2,000 modular homes a year and will produce its first prototype modular home in February.

Stone said the move was in part a response to looming skills shortages: “We think we can get to 1,000-2,000 [modular] homes a year. In 10 years’ time, most of the current workforce will retire.”



L&G’s housing delivery boss Ian Eggers said its plan to build 3,000 modular homes a year was “just scratching the surface” and it could build further housing factories on top of its facility just outside Leeds.

Eggers said the firm has installed 10 production lines and up to £60 million of manufacturing equipment in the factory, with the first prototypes set to roll off the production line by early next year.

He said: “We’ve got one factory, but we could have another factory and another factory. That’s the scale of the problem. L&G are massive and they’ve jumped both feet in to this. The question is ‘Can I keep the factory busy?’ I think you know the answer to that.”

Commenting on the potential for factory-built homes, Barwell said: “Off-site can make an important contribution for a number of reasons.”

And he said he had spoken to other institutional investors interested in following L&G’s lead. “I’ve had discussions with institutional investors and there will be more on that in the white paper [on housing].”


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