The government needs to acquire a much deeper understanding of how modern methods of construction (MMC) work, and then develop a clear strategy and demonstrate leadership, if the sector is to support more housebuilding.
Seven distinct categories of MMC have previously been defined by a government working group. Five relate to different types of pre-manufactured solutions, with Category 1 being 3D primary structural systems (more commonly known as volumetric modular). The sixth and seventh categories address labour reductions and productivity improvements on site, through traditional product-led and process-led approaches.
Category 1 MMC housebuilding represents an opportunity to deliver factory-built, modular homes that are cost effective, of consistent quality, and delivered on site quickly. They depend less on skilled labour, which is critical at a time when the construction industry is facing a skills crisis.
The UK needs a new way to deliver large numbers of new homes. Previous governments consistently set a target of 300,000 new homes a year, which never came close to being met. Despite this, the current government has repeatedly promised to build 1.5 million homes over the next five years, since coming to power in July 2024.
The drivers are there for MMC housebuilding to succeed. As well as housebuilding targets, Skills England says adoption of MMC needs to “expand considerably” to have a meaningful impact on current labour shortages. But it also notes that unpredictable profit margins restrict the construction industry’s ability to invest in skills and innovation.
As factory-based operations, Category 1 MMC companies need a consistent pipeline. Without a consistent and predictable level of demand, these companies cannot succeed – and those pipelines are still not there. Without the right level of demand, companies’ operations cannot be scaled up.
Scaling up is one ‘S’ of Homes England’s “five-S” approach to support MMC, alongside standardisation, safety and assurance, soft levers, and stimulating the market. However, the Built Environment Committee found that Homes England’s approach “has no clear objectives, no metrics with which to measure success, and no timescale for implementation.”
The Committee found that the private sector is not creating sufficient demand for Category 1 MMC housing. This is, arguably, at odds with the commonly cited problem of slow planning approvals creating pipeline ‘blockages’.
Currently, planning approvals are at their lowest since records began in 1979. Yet, as BBC News writes, the new government’s much-vaunted plans to reform planning rules may only go so far in driving an increase in housebuilding. Because most new homes in the UK are delivered by a few volume housebuilders, a better planning system will not necessarily encourage them to build on their sites any faster.
What does the government need to do to support MMC housebuilding?
According to the Built Environment Committee, substantial financial investment has been provided to the MMC sector without clear objectives for how the money should be used. Achievable goals and a coherent strategy are key to delivering more housing using Category 1 MMC. The government must ensure it achieves value for money from its investment in the sector, but progress is hard to establish because there is a lack of data about the use of MMC. Therefore, this must also be addressed.
Data is also an issue where warranty and insurance providers are concerned. Many are unwilling to accept compliance with the Building Regulations as sufficient, but the industry is not collaborating to gather the data it needs to issue warranties or insurance. The government should communicate a clear expectation to the sector to do this, which would support the delivery of MMC housebuilding.
With Government support and clear direction, the MMC sector is capable of helping to accelerate UK housebuilding. The sector needs to have solutions available to adopt as part of home design and specification. An example of such a solution is Arctek Dryshell, an integrated weather resistant barrier for OSB sheathing boards.
To find out how such products can benefit timber framed housebuilding projects, contact Arclin for their expert advice.