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Parents finally downsizing? How to help with the big move — without the big costs

The Canadian federal government is exploring the use of factory-built homes as a strategic solution to rapidly increase the country's housing supply. Housing Minister Sean Fraser has highlighted the need for an ambitious but achievable industrial strategy that involves collaboration between various levels of government and the private sector.

The urgency is underscored by the Canada Mortgage and Housing Corp.'s estimate that the country will face a shortfall of approximately 3.5 million homes by the end of the decade, contributing to soaring average home prices exceeding $1 million in some cities. Despite a recent 18% increase in housing starts in December, reaching 249,255 units on a seasonally adjusted annual basis, addressing the critical shortage remains a top priority.

Factory-built homes, also known as modular homes, are seen as a viable option to meet this demand. According to Sunil Johal, vice president of public policy at CSA Group, modular construction allows for the fabrication of building components in a controlled factory environment, providing flexibility to the construction sector.

However, the widespread adoption of factory-built homes faces challenges, with limited awareness among regulators identified as a significant barrier. Regulatory processes can be time-consuming, hindering the speed advantages offered by modular construction. Johal emphasized the need for coordinated, streamlined inspections and approvals, recognizing the unique aspects of modular building.

The CSA Public Policy Centre's recent report emphasizes the potential of modular housing to alleviate the housing shortage. Recommendations include addressing gaps in building codes, developing training and guidance for the industry and regulators, and improving access to financing.

Some homebuilding companies, like the Caivan Group of Companies, are ready to embrace modular building. CEO Frank Cairo highlighted the use of AI and generative design to automate parts of the factory home-building process. Caivan operates in over 50 communities in Ontario and is a top-three builder in the province by volume.

Cairo expressed concerns about the approval regime for factory-manufactured homes compared to traditional builds, emphasizing the importance of predictability in the approvals process for consistent productivity.

Modular building approaches, as outlined by Johal, can significantly reduce construction times by 25 to 50% compared to traditional methods. Approximately 80% of construction occurs offsite, offering cost savings of up to 20% and reducing waste by up to 46%. Caivan aims to leverage technology to increase its annual manufacturing output from 1,000 homes to an ambitious target of 4,000 homes per year within three years.

As the government looks to tackle the housing crisis, the potential benefits of factory-built homes are evident, but addressing regulatory challenges and fostering collaboration will be crucial to realizing these advantages and meeting the growing demand for affordable housing in Canada.



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