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Traditional Construction vs. Modular Housing Construction: Challenges and Benefits

The Challenge

For many years the construction industry has failed to match other sectors when it comes to

productivity performance, the certainty of delivery, skills shortages, and transparency. This

has led to many construction projects being completed over budget and behind schedule. 

Offsite construction

Modular and offsite construction brings about an opportunity for a step change in the

industry. It reverses many aspects of traditional building onsite and instead uses offsite

manufacturing-led production. 

Modular construction has brought about changes in the technological and economic

environment which is attracting new interest and investment. So this will be the time where

modular construction will have a more sustainable and widespread impact. 

The benefits

The different methods associated with modular construction can provide better quality of

building components due to the increased control over the design, build and manufacturing

process. It has the potential to overcome the challenges the industry faces today, especially


Modular construction offers an alternative to current methods of construction as it allows

innovative improvements across the asset life cycle in terms of cost, time, quality and health

and safety. The main benefit that modular construction brings compared to traditional

methods of construction is predictability.  

It can offer an alternative to the current construction existing state of affairs by promising

innovative improvements across the asset lifecycle in terms of time, cost, quality and health

and safety. however the key benefit of the offsite construction is that it also offers predictability. 

The reasons stated above is why offsite construction and modularization of the construction

processes within a controlled factory environment has been described as a potential game

changer in meeting the housing shortages in the US and addressing the issues associated

with traditional forms of construction. 

With a shift in the construction approach from a traditional approach to a modular approach,

it would allow greater quality control over what is built and where and also an increase in

predictability, delivering projects on time and in budget.

Many of the benefits brought about by modular construction include: 

Improvements in health and safety - offsite construction means workers are placed in a

more controlled environment where many of the risks associated with traditional construction sites can be avoided, such as unfavorable weather conditions and working at heights

A reduction in waste - Within controlled storage there is less chance of materials being

damaged from weather conditions. Also excess materials can be recycled onsite more


Cost effective - With flexible payment options available and a less time needed to construct

projects, it can save on labour costs. The design services associated with traditional

methods of construction can be expensive, however modular construction usually includes

this therefore saving on architect costs as well as on top of building expense

Speed of build - Modular buildings can be completed up to 30-50% faster than traditional

construction methods. This is because the indoor construction process can take place

alongside site and foundations work and weather delays are eliminated.

Reduction in GHG emissions - By producing buildings in a factory setting, it is easier to

control the use of energy compared to an open construction site. Also, producing buildings

close to home will reduce the carbon emissions that are often generated on large

construction sites due to lorry traffic.

Figure 2 - Comparison of CO2 output from various conventional (Cov) forms of onsite

construction against various methods of offsite modular (Mod) construction (Krug and Miles, 2013)

Research published by McKinsey Global Institute and McKinsey Capital Projects &

Infrastructure Practice highlighted that the market value for modular in new real-estate

construction alone could be as high as $130bn in Europe and the US by 2030. 

Offsite manufacturing is faster than the equivalent building process onsite, mainly because

of the controlled factory environment, but also due to enhanced levels of automation, the

ability to repeat activities, and the ability to deliver modules onsite, on time.

The stigma associated with modular housing

Modular housing has created a stigma among many people in the US. The stereotypical

‘double wide’ image, which became popular during the 70s in the United States, is what

many people associate with modular construction. Communities may not differentiate

between a modular home and a mobile home. However there is a distinct difference

between the mobile home and a high quality, well designed, modern modular home.

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