Innovation in Construction – Housing 2.0

Housing 2.0 - Innovations in Construction | via TAPED, the ECHOtape blogLike many of you, I enjoyed building things as a kid. Legos quickly turned into wood shop which led to building a summer family cabin, and before long, I was crafting a rewarding career in the construction industry. As such, I am fascinated by engineers and architects and craftsmen around the globe who continue to evolve and innovate. That said, I was recently asked whether I thought the industry had truly evolved since Levittown, the most famous, 1950s American postwar suburban developments.

My answer? Not as much as it needs too or should have.

Let me explain.

Levittown, Long Island, was, “…built on the eve of the baby boom and just before the 1948 Housing Bill liberalized lending, allowing anyone to buy a home with 5 percent down and extending mortgage terms to 30 years. Millions of families needed homes. Housing starts were down during the Depression and World War II. Returning vets armed with their GI Bill of Rights and guaranteed Veterans Administration low-interest loans wanted to move into places of their own. The Federal Housing Administration was guaranteeing loans from bankers to builders, and Long Island farmland was going cheap…”

Forward thinking real estate developers Levitt & Sons bought up the land near Hempstead, NY and went about building small, affordable homes for a new America. They also rethought home building: Cut out the middlemen suppliers, streamline construction, circumvent local zoning codes and keep labor unions at arm’s length. When the last nail was driven in 1951, 17,447 houses stood in Levittown.

It was monumental, paradigm-shifting achievement. Consider for a moment that the average time to dry-in that single family home in Levittown was 1-2 days. This included a finished roof, windows and doors, but no interior work.

Today production builders take about 5-10 days to get fully dried in.. That is five-times slower! To be fair, houses today are two times the square footage and have quite a bit more options … but it is fascinating that  Levitt & Sons famously were able to build a home “every 17 minutes.” in 1950 pioneering many of the techniques still used today.  Aren’t we better off with seismic codes and hurricanes codes? What about asbestos and lead paint?  While building in the 21st Century may take longer, it IS an undeniably better process.  

Is there still room for improvement? Of course! Even though 85% of homes are built on-site with “sticks,” I believe it’s high time the industry marches forward with other alternatives such as building with larger and more sophisticated panels or use tools such as CNC machines and factory automation that can do things more efficiently and with fewer errors.  I see small pockets of success all around us, which begs the question, why not more?

One word: labor.

What we build today is different than in 1950, but “how” we build is similar. The labor force, both skilled and unskilled, arrives on job sites every morning and constructs homes using lumber, nails, siding and such. Every time there is a recession, hundreds of thousands of construction workers are laid off as housing starts tumble. Inevitably, when the market strengthens, a middle majority of industry veterans return to join the new workforce until the next cycle hits.. But there is a new wrinkle in the equation, and that is the decreased number of construction workers (skilled and unskilled) returning after the bust.    

The impact of this reduced skilled labor pool is having significant impact on the number of homes that can be built.. Major production homebuilders such as DR Horton, Lennar, Pulte and others have consistently brought up labor issues in their quarterly reports.  Pulte stated that a large reason for missing their Q3 2015 sales goals by 6% was “a dearth of labor to finish homes on time”.

In a previous post, we shared the following information:  While residential construction spending climbed over $36 billion in August — to reach it’s highest point since October 2007 — there were more than 676,500 fewer workers in the residential construction industry compared to eight years ago.

This labor issue is causing hundreds of millions of dollars in “pain” to builders. The upside? That “pain” leads to innovation and change.

I, for one, believe it’s time builders rethink “how” we build. Unlike Levittown or today, the new age of building shouldn’t be weather vulnerable, it shouldn’t be fraught with jobsite improvisation and it shouldn’t include rework/punch list caused by trades screwing up other trades work.

The time has come for the housing industry to embrace and expand what it means to truly build shelter.  Perhaps Working in controlled environments and leveraging automation, pre-assembled finished wall sections, rooms or whole shelters will arrive on a jobsite then erected by a crane and a few site workers in a matter of days versus months.

And because we will be in controlled environments you will see the materials and techniques change. More specialized tape and adhesives in lieu of expensive metal fasteners (look at evolution of cars assembly) will be utilized. Larger “engineered” wood components (ie. CLT, large format OSB) or metal will be used since you aren’t constrained by how much a worker on a jobsite can lift. Hybrid materials with multiple functionality and highly engineered will improve durability, comfort, aesthetics and even the health of our indoor environment.   

I am excited to see what the future brings for our industry and so, I throw the question you: What pioneering efforts are you seeing? What do you think we will do to build faster, more affordable homes for the next generations?