Offsite Construction: A Solution to Housing Woes?

At the Political Action Committee (PAC) Days event last fall, organized and hosted by the Canadian Real Estate Association (CREA), over 400 officers, staff, and government relations and advocacy representatives from real estate Boards and associations across the country gathered in Ottawa to meet with Members of Parliament to discuss housing issues and potential solutions.

Fraser Valley Board representatives joined forces with other Boards from the province along with the British Columbia Real Estate Association and CREA to advocate for a province-wide approach to address the housing crisis. In particular, the team sought to advance three solutions to address Canada’s housing affordability and supply challenges:

• Stimulate supply and embrace innovation through offsite construction technologies
• Establish a national housing secretariat to ensure thorough consultation
• Provide HST/GST relief for non-profit-built affordable ownership housing

Meetings with MPs representing the Fraser Valley region including Ken Hardie (Fleetwood-Port Kells), Tako Van Popta (Langley-Aldergrove), Sukh Dhaliwal (Surrey-Newton), and Randeep Sarai (Surrey Centre) provided an opportunity for the Members to learn more about organized real estate and the benefit and insight of our boots-on-the-ground perspective as well as data insights into real estate market trends, both province-wide and riding-specific.

The offsite construction advantage

With housing demand increasing along with the country’s population, and with inventory and new construction unable to keep pace, of the three solutions conveyed to MP’s, stimulating supply across the housing continuum by embracing innovation through offsite construction technologies piqued the greatest interest among the officials.

According to the Canada Mortgage and Housing Corporation (CMHC), Canada is projected to face a shortage of 5.8 million new homes by 2030, and we can’t rely solely on traditional construction to even remotely attempt to meet that target.
This is why stimulating offsite construction technologies through various funding streams that allow the industry to scale up is imperative. This includes incentives under the Housing Accelerator Fund (HAF) and the new Homebuilding Technology and Innovation Fund, to improve supply across the entire housing continuum.

Given the housing shortage in Canada, rapid construction needs to be a priority in resolving the housing crisis. Offsite construction technologies offer numerous advantages over traditional methods, particularly in efficiency, and should be supported as the industry scales up. For example, once scaled, the mass adoption of these innovative and sustainable building practices will help build supply across the housing continuum faster and improve housing affordability. In particular, offsite construction technologies benefits include:

• 20% to 50% faster to complete. Essential to meet the need for 5.8 million units by 2030.
• Economies of scale: As the industry reaches scale, per unit costs become lower than traditional housing units.

Offsite construction provides solutions that emphasize affordability, speed, and sustainability, offering a path forward for urban areas struggling to meet housing demand.

Writing for Wood Industry magazine, Jayden Campbell, an industry expert and Product Manager at Akhurst Machinery, finds that “modular construction is emerging as a promising strategy to deliver affordable housing quickly. This method involves manufacturing building components, or ‘modules,’ offsite in controlled environments. The prefabricated modules are then transported to the building site and assembled like building blocks, forming a complete structure. The advantages of modular construction lie in its ability to drastically reduce construction timelines, improve cost control, and scale effectively to meet large housing demands.

“Traditional construction projects can take years, often delayed by weather, labour shortages, red tape, and supply chain disruptions. Modular construction bypasses many of these challenges by manufacturing components indoors, in factory settings, where production can continue year-round, unaffected by external conditions. This rapid build process is crucial to meet severe housing shortages in fast-growing urban areas such as Vancouver and Toronto.

“In addition to the speed of delivery, modular housing offers cost savings. Manufacturers can reduce material waste and labour costs by standardizing designs and producing modules in bulk. The controlled factory environment enables efficiency, reducing errors and rework.

“Additionally, the offsite production of modules requires less skilled labour at the construction site, reducing expenses. [Given our current labour skills shortages in Canada], these advantages make modular housing a particularly attractive solution.”

The article adds that in the realm of modular construction, countries like the Netherlands, Sweden, and Japan are leading the way with innovative solutions and rapid build times:

“Industry leading companies like BAM and Heijmans in the Netherlands have made remarkable strides in modular construction. They are known for their use of cutting-edge Modular Building Automation (MBA) equipment to construct sustainable, affordable housing at a faster pace than traditional methods. These companies have embraced offsite construction and factory-built components to streamline processes and reduce construction times dramatically by focusing on sustainability, speed, and efficiency.

“BAM, for example, places a strong emphasis on modular and sustainable construction, producing energy-efficient homes in controlled environments that can be rapidly assembled on-site. Similarly, Heijmans, another leading Dutch construction company, has embraced modular technology focusing on sustainability and alternative, decentralized energy generation. Both companies’ approaches enable the construction of net-zero homes—houses that generate as much energy as they consume—with the primary goal of increasing housing production.”

The question now becomes, how willing is the Government of Canada to truly embrace offsite construction technologies, thereby walking the talk on a tangible, innovative solution that can make more than a dent in solving the housing supply crisis in Canada.

Read the complete Wood Industry article here.