Epwin Group, a leading manufacturer of PVC-U windows, doors and fascia systems, recently conducted research including a survey of UK social housing professionals, on the use of modern methods of construction (MMC) in social housing. Here Sonia Travis, Head of Commercial Sales at Epwin Window Systems, discusses MMC, the survey and some of its findings.
The charity Shelter claims that in order to alleviate the crisis, three million social homes must be constructed over the next 20 years, so it is unsurprising that social housing providers are feeling the pressure to find new ways to quickly deliver affordable homes.
The Government certainly sees MMC as a way of modernising the construction industry and increasing productivity, with off-site manufacturing technology laid out as a strategic area of focus in its ambitious Construction Sector Deal.
MMC in social housing
Some of the larger social housing providers have committed to the use of MMC by making significant investments in state-of-the-art manufacturing facilities, whilst others are partnering with modular manufacturers on developments of all sizes.
It’s possible that MMC has now reached that commercial tipping-point that makes it viable and scalable, which is unsurprising given the reported benefits, such as the speed of delivery, cost savings, reduced wastage and improved quality.
Undoubtedly, there is an appetite for MMC out there; however, the pace feels slow, and until the industry matures, many social housing providers may be simply unwilling to take the risk of investing time and money into something they consider unproven.
Reported drawbacks to MMC, and, therefore, barriers to uptake, include the high cost to set-up, the need for economies of scale to make it a financially viable option, negative consumer perceptions of modular or ‘pre-fab’ housing, and the difficulty in accessing finance for MMC developments.
To better understand the uptake of MMC in social housing, attitudes and perceptions of these construction methods and plans for future use, we surveyed social landlords in late 2019.
How widespread is the use of MMC?
It is initially encouraging that 52% of respondents’ organisations have constructed homes using MMC. However, the relatively small size of these developments (42% of respondents have constructed fewer than 100 MMC homes), and the low percentage of MMC construction versus traditional methods (for 65% of respondents, MMC homes represent 0-10% of their total construction output), perhaps offers a truer reflection of the maturity of the market.
In my opinion, these smaller developments could suggest that social housing providers are testing out the use of MMC before using these methods more widely.
The use of MMC looks set to become more widespread over the coming years, with 100% of those who have constructed homes using these methods stating that they are increasing the number of MMC developments over the coming years. In fact, 70% of these respondents stated that they will be increasing the number of MMC homes by at least 50% year-on-year for the next five years.
It is also interesting to note that there is a correlation between those who have constructed higher numbers of homes using MMC, and a higher percentage increase in planned MMC developments.
In my opinion, this could suggest that larger developments are offering housing associations the economies of scale, which make MMC developments more financially viable.
Is further uptake of MMC imminent?
80% of respondents who are yet to develop using MMC will be using these methods to some degree within the next five years.
Of the 20% who don’t have plans to use MMC in the near future, reasons given include that some developments are too small to be cost-effective and that MMC suppliers aren’t keen on working on small developments.
Barriers to MMC
The most significant perceived barrier to MMC by some margin is the immaturity of MMC manufacturing. Capital investment came in second place, and concern about cost-effectiveness in third.
In my view, these are all linked. MMC requires volume and continuity of demand to offer economies of scale; however, because the market is immature, inefficiencies and inexperience mean that costs can be inflated. These issues explain why some social housing providers are setting up their own factories or buying their suppliers, as this ensures stability and scalability of supply.
Negative consumer perceptions about MMC homes and difficulty in gaining finance for MMC developments were considered to be the least important barriers.
Benefits of MMC
Speed of delivery was ranked as the biggest benefit, with quality of construction coming a close second.
Given the shortage of homes in the UK, and the levels of output needed to meet current and future demand for housing, it is unsurprising that speed of delivery is viewed as such a significant benefit.
Furthermore, because the homes are precision-manufactured in a controlled environment, there are fewer snagging or longer-term build issues post-completion than with traditional construction. This is a significant benefit for social housing providers who are responsible for maintaining the asset post-completion.
It is interesting that over 60% of respondents ranked cost savings as being the least important. In my opinion, this is either a reflection of the immaturity of the market or because cost savings with MMC are associated with economies of scale, and many of the survey respondents’ MMC developments are relatively small.
Greater cost savings could be imminent. Because MMC allows for the faster delivery of homes, reduces defects, improves as-built performance and reduces maintenance costs, as the industry matures, there is a good chance that build costs will come down significantly over the coming years.
For more information on Epwin’s MMC in social housing research or to download the full report, please visit the below website.