The housing crisis is global, yet every country, state and territory believes it’s particular to them. The cold hard truth is it’s neither unique to one locality nor a single regional cause.
Yes, our current predicament is the result of several short-term shocks including labour shortages, supply chain disruptions, high inflation and rising construction costs. But the root of the crisis lies deeper. It begins in the building industry’s 70-year decline in productivity, which is propagated by the chronic absence of investment in research and development.
Building has one of the lowest rates of investment in R&D with an allocation of only 1-2 per cent of turnover. This compares to at least 10 per cent in car manufacturing, tech, pharmaceutical or consumer electronics.
Research is no crystal ball, but I’m certain things will not improve without innovation.
This innovation will involve new materials that are more sustainable and environmentally friendly, new building systems that come together quickly and more efficiently, and new housing delivery approaches that can take out intermediaries and flatten the building value chain. It will involve new processes and technologies that create new trades and jobs. It will produce housing that can be delivered in a day to solve an immediate and pressing need.
In this future, prefab and modular housing can play an important role, alongside traditional onsite building, and we are well placed to grow this manufacturing industry locally. Currently Building 4.0 CRC and the NSW government are undertaking a $4m R&D program harnessing modern methods of construction (MMC) – including prefab, modular, and kit-of-parts approaches – to increase medium density social housing. It will not only produce quality homes more quickly but build a stronger housing industry.
Offsite manufacturing and productised building approaches deliver certainty, safety, quality design, more sustainable outcomes and greater workforce diversity. The possibilities are compelling. But to reach this future, we need to unleash the full force of our manufacturing knowledge and capability into the housing market. Australia has deep MMC expertise that we can grow and eventually be world leaders in. Let’s invest, innovate, and step up together.
Mathew Aitchison is the CEO of Building 4.0 CRC