How Likely Are Builders to Adopt Building Systems?

Committees and Councils
Published

Building systems have been a tenured history, but despite touting benefits such as decreased time, labor and materials, builders generally have been slow to incorporate them into their businesses.

Home Innovation Research Labs has been tracking the adoption of offsite housing in new single-family homes and multifamily projects for the past 20 years. The multifamily market has more readily incorporated offsite building methods than the single-family market, with a noticeable uptick in both in recent years. But even with this growth, as well as an increase in the number of concrete-framed homes, building systems still comprise only a sliver of the housing market.

So what are the barriers to more widespread adoption?

A survey by Home Innovations Research Labs last week points to uncertainty as a predominant factor among builders who are leaning away from offsite construction.

"There is a high degree of uncertainty in home building right now," shared Ed Hudson, MBA, director of Market Research at Home Innovation Research Labs. "Construction times are lengthening, supply chains have been disrupted, and labor supplies are less reliable than they had been in the past. With all that uncertainty, introducing offsite would be another big uncertainty to add to their business."

Last week's survey incorporated three additional questions related to COVID-19 and how the impact of the pandemic on builders' operations may have altered their attitudes about offsite. The majority — 72% — responded that their attitudes had not changed, while 9% said the current environment had caused them to lean away from offsite construction. Those whose attitudes leaned more favorably to offsite construction represented 19% of respondents.

Among the top reasons builders are responding more favorably to offsite construction in the wake of the pandemic include:

  • Utilizing factory-built components should make it easier to practice social distancing on the job site.
  • Reduced contact with builders, suppliers and vendors, and distancing of trade contractors on site reduces risks.
  • The new building environment is more complex, which could be resolved with the more predictable process of offsite construction.
  • As lumber and other supplies diminish and materials prices increase, offsite construction offers an opportunity to bring some cost control back to the industry.

Hudson will present the full findings of the survey, as well as comparisons to historical data and comparable surveys in 2020 and 2019, as part of the Building Systems Week webinar series to highlight trends in the industry. Learn more here.

Subscribe to NAHBNow

Log in or create account to subscribe to notifications of new posts.

Log in to subscribe

Latest from NAHBNow

Energy | Advocacy

Sep 16, 2025

Kansas City Builder Testifies Against Energy Code Mandates

The Home Builders Association of Greater Kansas City (KCHBA) called on Congress today to oppose energy code mandates that raise the cost of housing and do very little to increase energy efficiency for home owners.

Economics

Sep 16, 2025

Builder Confidence Steady but Future Sales Expectations Hit Six-Month High

Builder confidence in the market for newly built single-family homes was 32 in September, unchanged from the August reading, according to the NAHB/Wells Fargo Housing Market Index (HMI) released today. While builder sentiment has hovered at a relatively low reading between 32 and 34 since May, builders expressed optimism that a more favorable interest rate climate could bring hesitant buyers off the sidelines in the final quarter of 2025.

View all

Latest Economic News

Economics

Sep 16, 2025

Builder Confidence Steady but Future Sales Expectations Hit Six-Month High

Builder sentiment levels remained unchanged in September but lower mortgage rates and expectations that the Federal Reserve will soon cut the federal funds rate led to higher future sale expectations in the coming months.

Economics

Sep 15, 2025

Shelter Inflation Continued to Cool

Inflation accelerated to a seven month high in August as tariff-related costs continued to pass through to consumers, according to the Bureau of Labor Statistics’ (BLS) latest report. Core goods prices, which exclude volatile food and energy, rose by 1.5% in August, the fastest annual pace since May 2023.

Economics

Sep 15, 2025

Builders Stay Cautious as Single-Family Permits Extend Downtrend

Single-family housing permits slipped for the seventh month in a row, highlighting affordability headwinds and weak demand. While multifamily permits ticked up, the sector’s volatility leaves the outlook uncertain. The split underscores a housing market still under strain, with single-family softness weighing on broader growth prospects.