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This Fresh Research Will Help You Gauge How to React to the Trend Toward Off-Site Construction

Source: Home Innovation Research Labs survey

A just-released survey of 300 builders and remodelers by Home Innovation Research Labs shows a larger percentage of big builders plan to embrace off-site construction solutions than do smaller builders, but both groups are moving in that direction.

This month’s poll also indicates a slight pickup in interest by builders compared with an identical survey in April. “We also found that, contrary to some industry thinking, the competition among various off-site housing solutions will not likely be winner-take all,” said Ed Hudson, the Labs’ director of market research. “Rather, it looks like several different solutions have their own followings and will be able to grow.”

While smaller in number, the builders who put up 25 or more homes each year account for about 75% of all new housing construction, Hudson noted, so their outsized interest in off-site construction compared with small builders is important. They already are big users of roof trusses. As for growth categories, the No. 1 increase in use planned by large builders within five years was open wall panels, followed closely by precut framing packages and pre-assembled floor panels.

In contrast, smaller builders—who put up the roughly 20% of all residences built nationwide that are considered custom homes—have less reason to be interested in off-site construction for its production savings. Their motivation is more likely to stem from the labor shortage and the higher quality that components possess when they’re assembled off-site.

The survey also asked builders to list what off-site systems they’d go to more often in the next year. Trusses came first, followed by open panels and pre-cut framing packages.

“Based on a deeper analysis, I believe that open wall and floor panels are going to be on the front edge of this market increase, using the existing widespread network of shops and factories around the country,” Hudson said. “They are a less radical change for builders than some of the other options. However, I believe as capacity ramps up in closed wall panel systems, this form of off-site construction will see a dramatic upswing, as well.”

The survey results buttress my conclusions after attending the Industrialized Wood-Based Construction Conference, an October gathering in Boston that touted the prospects for both off-site construction and tall mass timber buildings.

The numbers also are likely to cheer two big dealers’ plans. Builders FirstSource intends to invest in 25 new components facilities over the next four years, while BMC opened an automated truss facilities in Georgia this year, is building another in Salt Lake City now, and will follow those with a similar plant serving central Texas.

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