For the past year, the residential real estate market has experienced a dearth of available homes, making it difficult for regular buyers and real estate investors alike to purchase properties. And California has been no exception.
But now, a building start-up is looking to increase production on prefabricated homes. And once it kicks into gear, it could not only result in more inventory but a wider selection of affordable, environmentally friendly properties.
Automating the process
Plant Prefab, a homebuilding start-up in California, recognizes that the demand for affordable, sustainable housing just seems to be growing. To this end, it recently opened a second factory in Ontario, Canada, and also announced that it's raised $30 million for a third factory that will automate the homebuilding process.
All of this could help open up California's housing market in a very meaningful way. Not only are Plant Prefab's homes eco-friendly, but their price points are extremely attractive. At a time when the cost of newly built homes is soaring, Plant Prefab will be offering its homes at a lower price than most new construction properties. And how it's able to do that boils down to improved efficiency in the building process.
The upside of prefabricated construction is that builders aren't subject to the same weather-related delays that on-site builders experience. The construction process can happen year-round, saving time and money simultaneously. Plus, having numerous homes constructed at once can streamline the process of procuring materials, which can be purchased and delivered in bulk for added savings.
Plant Prefab has also managed to create a construction process that's cleaner than most builds. The company's third factory will allow it to cut waste by up to 30% while saving 10% to 25% on construction costs. Furthermore, once that third location is up and running, the company expects to reduce building times by 20% to 50% compared to traditional building methods.
Of course, in a state like California, energy efficiency is an important selling point for homes. But Plant Prefab claims that its homes are 30% better in that regard than the average home built in California in 2020 under Title 24 energy efficiency standards.
Furthermore, the company insists that its homes will better fit into urban settings, where space is extremely limited. These homes are also more suited for lots that are irregular in shape. Plus, Plant Prefab allows buyers to have a say in the design process, so while its homes may be prefabricated, they're not necessarily cookie-cutter.
The Millionacres bottom line
Of course, the prefabricated home trend isn't limited to California alone. Many real estate investors are looking to prefabricated homes as a less expensive alternative to existing homes (especially at today's price points) and traditional new construction. But the fact that Plant Prefab is pulling off these homes in a more sustainable way is what sets the company apart from others like it. And it wouldn't be surprising to see the company expand its production centers beyond California in years to come.