Bankrate reported in early March 2023 that home sales nationwide experienced a 12-month-long decline. Prices flattened or fell in hundreds of regions. The seller’s market many of us have experienced for the past several years may finally end.
With the industry cooling off, many stakeholders may predict that the 5.5 million US housing gap could start closing and the market will right itself without any advancements. I, and many others, respond to this with a resounding “no.” Too many headwinds exist that prevent individuals and families from becoming homeowners. The costs to build affordable homes that people will want to buy remain too high. The pressures of current and projected labor and material expense, the unmet demand for skilled labor in the construction industry along with the century-old construction techniques still employed by mainstream developers mean fewer homes being built that can meet the current demand, let alone make a dent in reducing the existing shortfall.
Our mission to change the industry and empower its workforce to do more must continue. We cannot discard the siren song of hi-tech, 3D, off-site construction — quite the opposite. We need to embrace it. We can, and must, build custom homes and townhomes with assembly-line efficiency and employ advanced technologies to do it. This approach empowers skilled tradespeople to stand up homes in hours rather than weeks, removing wasted time, cost, and materials while doubling their combined output – all without adding one more hour to the timecard.
We saw this in action recently with a housing development program in the San Diego area. Hallmark Communities contracted Agorus® to build 39 townhomes for its Daybreak development, beginning in July 2022, starting with the four model properties. We constructed seven buildings, each holding 4-6, two-story townhomes of approximately 2,000 livable square feet. Each frame included full MEP routing to streamline subcontractors’ follow-on installation of electrical, plumbing, HVAC, and Internet infrastructure. Our 3D design process and off-site construction powered by proprietary software and smart robotics give us more options for greater customization of any project, whether in-fill or new sites. We could reconcile off-site construction to the ‘as is’ environment, and we value-engineered the best structure for it, with everything needed to finish the framing. Doing so reduced on-site installation time by two-thirds while exponentially reducing material waste to less than 5 percent. It took us less than a day to manufacture each structure in our factory and three days to do the on-site installation.
Moreover, we demonstrated how to meet the industry where it is and where it could be. The Daybreak project highlighted the potential for how technology can build one, two, and three-story townhome buildings in less than 5 days. This advancement becomes particularly important with the reduced availability of new and in-fill land to construct the homes our communities need, where the only way to increase square footage in many regions is to build “up” instead of “out.”
No matter the short-term fluctuations in the US housing market, one thing remains clear. The shortfall remains and will not right itself by changes in interest rates and sale prices. We cannot, as an industry, slow down the advancement and employment of technology. The negative impacts will be too significant.
Garrett Moore is the CEO and Co-Founder of Agorus®, a company on a mission to accelerate the world’s transition to off-site construction. Agorus leverages its custom software and automated factory to empower builders with the future of construction. He can be reached at garrett@agorusbuild.com.