Many who look at the high and rising cost of housing see the problem as fundamentally one of production methods; more specifically, that homes could be built more cheaply if they were made using factories and industrialized processes, instead of assembling them on site using manual labor and hand-held tools.
There are MANY companies in Sweden building pre-fab houses.
Myresjöhus I checked and they have built almost 100,000 houses to date.
These houses you can tailor almost any way you want.
Here you can't buy a piece of land in the same way. Whole neighborhoods are built by the same builder who bought a chunk of land and then the more or less identical houses are sold to individuals (but why no prefab houses??).
I always found Levittown in Long Island fascinating I recently bought a book about the history of Levittown called “perfect communities” which I plan on reading this weekend. Maybe this book will provide some answers.
It's been a good series exploring construction costs. It would be helpful for me if you addressed directly the somewhat mundane and worker oriented problem that concerns me: in my "world" the more or less hand and jobsite tools I use to do construction have vastly improved my efficiency: I have laser levels, cordless long lasting powerful tools, press-connect copper, flexible lines, pre-hung doors, etc. An enormous number of 'things' that make my work speedier. How have all these advances not resulted in much more sq. ft. production per worker hour? My 'feelings' tell me that in my area the bureaucracy captures all the possible savings: high fees, more inspections, more labor requirements, supervisions, etc. I have land I would happily build on but the simple act of connecting a home to the sewer system is over $20,000. Having the county bring the water line 50' down the street: $100,000. Having the electric company upgrade their side of the power grid: $50,000. In my area, there is no possible way to capture this investment through rent. I could build a home efficiently with my team of a few people cheaply and quickly, and yet it would take years and $100,000s of dollars in fees and increased property taxes to do so.
So: if you felt the interest in dividing construction costs between: materials, the on the ground labor, the supervision, the fees etc. - that would give me real direction. If the labor at the site has not become vastly improved from 1970 to 2025, then something is wildly wrong: our site tools are so much better, that portion of construction should have had costs lowered dramatically.
It may be that we are searching for a breakthrough that just doesn’t exist. Given government constraints, maybe construction costs are already minimized. Rather than having government push for a breakthrough, maybe government should just get out of the way. Rational, simple and uniform building codes and zoning regulations might be a good place to start.
I like this continuing deep dive into why construction costs haven't benefited from factory production like many other industries. One idle notion that I haven't seen discussed, is there some argument similar to a Geoffrey West style scaling argument going on here?
When our fabrication and transportation technologies are one scale, what is the impact of their ability to produce efficiency gains relative to the scale of the product they are generating? For example, chip fabs are giant, and what they produce is minuscule. The ratio there is huge. It seems that housing is one of the few manufacturing areas where the transportation and manufacturing infrastructure are almost necessarily smaller than what they are generating. Shipbuilding, and aircraft are other examples of places where the scale is often less than one, both of these aren't known to be especially 'lean' industries either, and they have the advantage that transportation is less of a bottleneck for them.
There is an interesting article about operation breakthrough in an issue of the New York Times from last year
https://www.nytimes.com/2024/06/08/headway/how-an-american-dream-of-housing-became-a-reality-in-sweden.html
There are MANY companies in Sweden building pre-fab houses.
Myresjöhus I checked and they have built almost 100,000 houses to date.
These houses you can tailor almost any way you want.
Here you can't buy a piece of land in the same way. Whole neighborhoods are built by the same builder who bought a chunk of land and then the more or less identical houses are sold to individuals (but why no prefab houses??).
I always found Levittown in Long Island fascinating I recently bought a book about the history of Levittown called “perfect communities” which I plan on reading this weekend. Maybe this book will provide some answers.
It's been a good series exploring construction costs. It would be helpful for me if you addressed directly the somewhat mundane and worker oriented problem that concerns me: in my "world" the more or less hand and jobsite tools I use to do construction have vastly improved my efficiency: I have laser levels, cordless long lasting powerful tools, press-connect copper, flexible lines, pre-hung doors, etc. An enormous number of 'things' that make my work speedier. How have all these advances not resulted in much more sq. ft. production per worker hour? My 'feelings' tell me that in my area the bureaucracy captures all the possible savings: high fees, more inspections, more labor requirements, supervisions, etc. I have land I would happily build on but the simple act of connecting a home to the sewer system is over $20,000. Having the county bring the water line 50' down the street: $100,000. Having the electric company upgrade their side of the power grid: $50,000. In my area, there is no possible way to capture this investment through rent. I could build a home efficiently with my team of a few people cheaply and quickly, and yet it would take years and $100,000s of dollars in fees and increased property taxes to do so.
So: if you felt the interest in dividing construction costs between: materials, the on the ground labor, the supervision, the fees etc. - that would give me real direction. If the labor at the site has not become vastly improved from 1970 to 2025, then something is wildly wrong: our site tools are so much better, that portion of construction should have had costs lowered dramatically.
It would be great to see an analysis costs by type as you suggest.
It may be that we are searching for a breakthrough that just doesn’t exist. Given government constraints, maybe construction costs are already minimized. Rather than having government push for a breakthrough, maybe government should just get out of the way. Rational, simple and uniform building codes and zoning regulations might be a good place to start.
I don’t believe this is really the main issue. The issue is that there is nowhere to PUT the homes because of regulations.
I agree, this seems to be one of the main reasons.
And also people seem to think prefab means trailer trash while in reality the houses are often nicer than McMansions.
I like this continuing deep dive into why construction costs haven't benefited from factory production like many other industries. One idle notion that I haven't seen discussed, is there some argument similar to a Geoffrey West style scaling argument going on here?
When our fabrication and transportation technologies are one scale, what is the impact of their ability to produce efficiency gains relative to the scale of the product they are generating? For example, chip fabs are giant, and what they produce is minuscule. The ratio there is huge. It seems that housing is one of the few manufacturing areas where the transportation and manufacturing infrastructure are almost necessarily smaller than what they are generating. Shipbuilding, and aircraft are other examples of places where the scale is often less than one, both of these aren't known to be especially 'lean' industries either, and they have the advantage that transportation is less of a bottleneck for them.