Expert claims that cooperation is needed for quicker housing construction from factories

The fragmented market for ready-made homes needs to work together more to increase the number of factory-built homes in the Netherlands. That is what sector specialist Jan van der Doelen of ING said. He sees this type of home, which only needs to be screwed together on the construction site, as a good solution for the major housing shortage in the Netherlands.

CBS reported at the end of September that the number of completed newly built homes dropped to its lowest level since 2018 in the first six months of the year. Van der Doelen thinks that currently, 15 percent of the new homes are from a factory. "The intention is that this will increase and not decrease because we need to accelerate and build affordably. Industrial construction is an answer to that."

According to the economist, there are around 50 companies that are active in so-called industrial construction, which is when parts or sometimes whole homes are put together in a factory by machines. The largest parties can produce a maximum of 2,000 to 4,000 homes per year.

However, the number of ready-made homes built from factories is lagging behind because industrialization involves significant investments, Van der Doelen explained. This leads to many companies being afraid to do this. “Investing in combination with a construction company is not always a preferred combination. Builders need to be able to move in a volatile market. If sales are down, you need to be able to move with your costs, but when you invest, your costs remain at a higher level."

The government can play a facilitating role, but the construction companies, the project developers, and investors need to work together "to make plans together to make this bigger than it is now," the economist believes.

The Economic Institute for Construction and Housing (EIB) stated last year in a report that homes built in a factory have limited usability as the construction time and labor costs saved would not be so significant.

Van der Doelen also admits that the preparation for homes built in a factory is very different and also takes time. However, he thinks that housing corporations, in particular, can benefit from being able to use these types of homes. They have to build a lot of extra homes and keep them affordable for their target group.