What are the Cost Benefits of Modular vs Traditional Methods of Construction?

Posted by The Landsite on 21st February 2023 -


Modular construction has been around in some form or another for several decades, utilised extensively in the post-war period at a time when quick and low-cost construction methods were sorely needed to address the housing crisis.

Since then, modular construction methods have progressed well beyond those of the 1950s prefabs, becoming markedly more innovative due to the advances in technology. They are also much more sustainable, something which has increasingly come into focus over the last few years.

Now, as we find ourselves faced with the economic challenges brought about by the pandemic, including disrupted global supply chains and the rising costs of raw materials and energy, should we be looking at modular construction to meet the demand for affordable housing. Let’s take a look at the considerable benefits modular construction has over traditional construction methods, and the impact that is likely to have on costs.

What is Modular Construction?

The process of modular construction, also known as off-site construction or volumetric construction, generally describes when a building is constructed away from the final build site in smaller interlocking parts. The process of modular construction consists of planning, designing, prefabricating, transporting and constructing the building elements. As a result, modular builds are typically more cost effective than traditional builds, and they take much less time to construct – often twice as fast as traditional on-site construction.

Although modular buildings – commonly known as prefabs in the United Kingdom – have endured somewhat of a bad reputation, being viewed as a short-term solution unlikely to stand the test of time, investors and developers are beginning to pay much more attention to modular construction and all it encompasses, with many high-profile firms investing in technologies, manufacturers and developers that operate in the space. 

These days, modular buildings are built to last. They combine a number of innovations, like computer-controlled manufacturing, which can be automated with planning, design and development software. Along with the speed and cost of modular construction, there are countless other benefits, which go some way to explaining why their stock is rising in the construction industry.

With numerous studies suggesting that, compared to traditional construction, modular construction offers a higher-quality finished product, construction savings over the course of the build, improved health and safety, and increased occupant satisfaction, it’s clear to see why the UK Government has identified modular construction as a solution for two of the most pressing challenges facing the housing sector today – unit supply and affordability.

What are the Benefits of Modular Construction?

Typically, the construction of modular buildings off-site can run alongside site work. This amounts to a significantly reduced construction schedule, with projects completed 30% to 50% sooner than traditional site construction. For investors and developers, this means that buildings can be occupied much faster than traditional builds, which can potentially lead to a faster return on investment.

One factor that impacts the speed of construction is the weather. As all developers will know,  downtime caused by poor weather conditions can lead to serious delays and, in some cases, the need for compensation. This is especially true if construction contracts include adverse weather clauses.

However, owing to the fact that the vast majority of modular construction is conducted in a factory in controlled conditions, the weather scarcely impacts the construction schedule and thus the risk is mitigated. With careful planning, it is possible to omit this risk entirely.

As modular construction predominantly takes place inside, there are benefits to the construction process that lead to significant sustainability improvements over traditional construction methods.

When done correctly, modular construction can be a controlled process that generates much less waste, with tighter inventory controls and fewer spoiled materials. Many modular construction developers use sustainable materials sourced from local suppliers, paying particular interest in renewable materials and carbon-neutral manufacturing processes. 

Additionally, developers can opt to include sustainable features such as eco-friendly heating and water systems and alternative energy sources like solar panels, ultimately making the final build cheaper to run.

The Landsite member Global V Tech (GVT) are specialists in moderm methods of construction and are fully aware of the benefits of off-site construction.  ‘With the new future homes standards and developers making a conscious effort to become more sustainable, it is important now, more than ever, to consider offsite construction methods for all new builds. Most of these construction methods far exceed the new u-values required and fully integrate all green technology. More and more contractors are becoming open minded to alternative methods and lenders are starting to see the benefits of working in a controlled factory environment and spending less time onsite. GVT  are experiencing an increase in enquiries by SME developers and housing associations for their guidance on sustainable construction. 

Saving Costs with Modular Construction

With the rising cost of living firmly in the limelight, it’s no surprise that many are looking for answers to the questions surrounding affordable housing.

From a reduction in material waste to faster build times and reduced on-site labour to sustainable construction methods, modular construction presents a raft of cost benefits attractive to investors, developers and occupants alike.

Overall, modular construction is far less likely to be impacted by the delays commonly experienced in traditional on-site construction, which in turn reduces the project cost. Modular construction is quickly becoming a viable alternative to traditional construction, while at the same time addressing the key challenges facing the construction industry today.

Other similar articles: 

Top Tips For Sustainable Property Development

The Role of Sustainable Development Within the Built Environment

Accelerating Climate Action Through Sustainable Development

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Tracey Turner

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