Policy Prescriptions for Modular Housing

In an article for the Center for American Progress, Michela Zonta highlights the advantages of modular construction, arguing that encouraging more modular home building can reduce construction and housing costs, get homes built faster, and improve safety for workers.

According to Zonta, “If governments engage in coordinated initiatives at all levels to bring modular building to scale, it could also help make housing stock more resilient and sustainable relative to the challenges of climate change.”

While modular construction makes up just 3 percent of U.S. residential housing stock, it represents 45 percent of housing in Finland and Norway. “Several factors have limited the United States’ market share, including financing and payment schedules, building codes and zoning, transportation requirements, labor shortages and costs, and stereotypes.”

The article recommends that governments “Expand financial resources for the modular construction of affordable housing,” standardize building and land use codes for modular building, and incentivize more modular production through tax credits and other mechanisms.