Could modular homes be a growing part of the solution to the housing shortage?

Representatives from the BSA and Members recently visited the L&G Modular Homes factory in Sherburn to learn more about the modular homes being developed.

By Chris Busey, BSA Policy Manager

The shortage of housing in this country has been well documented. Decades of underinvestment has left us over 1.5 million homes short of what’s needed.[1] The lack of high-quality, affordable homes has led to many being priced out of home ownership and joining the long waiting lists for social housing. The current Government has committed to targeting 300,000 new homes built per year by the mid-2020s. However, that ambition has not been met with 216,000 homes built in 2020-21 – down from the pre-pandemic figure of 243,000 in 2019-20.[2] Solving this problem cannot be achieved in one fell swoop. It will require smaller, piecemeal solutions from all corners of the housing market.

Against this backdrop, it was heartening to see the progress being made on one of these solutions on a site visit I took last week to the L&G Modular Homes factory in Sherburn in Elmet and its first development site in nearby Selby. I was joined by BSA colleagues and a number of our members keen to learn more about this growing corner of the housing market.

A few things in particular struck me as we toured the factory and then an assembled home. First, these are not your grandfather’s modular homes. The visit confirmed that modular homes have come a long way from the post-war, pre-fabricated homes that many associate with the term. Whilst those homes were meant to be churned out quickly, they weren’t designed or built to last. By contrast, L&GMH’s homes have a minimum design life of 60 years, and the materials and build process match this ambition.


Second, the production process reconciles the apparent contradiction between scale and efficiency on one hand and quality and precision on the other. The sheer size of the factory – spanning some 550,000 square feet with enormous machinery and cranes to match – is impressive. And the factory can produce 3,500 homes per year and complete a module from start to finish in just 15 days. Yet every stage of production emphasised quality, with numerous checks completed before a module can move on to the next stage. This results in an average of less than one defect per home when it leaves the factory and an NHBC average rating exceeding five on a six-point scale.[3] L&GMH also emphasised their continuing efforts to improve the finished product, be it through design, materials construction, or assembly.


Third, the finished product would make a lovely home for many people, particularly first-time buyers. The end result is comfortable, quiet, and energy efficient. Many of us touring the show homes commented on the spaciousness of the layout and the lack of outside noise, despite being on a busy road. In terms of efficiency, each assembled home is EPC A-rated and affixed with PV panels.   


My final takeaway from the visit may say more about the housing market than it does L&GMH. Our hosts noted that the factory is currently running at about one-third of capacity. Whilst this may only be one piece of the puzzle required to solve our housing shortage, it is nonetheless an important and growing one. Modular homes and other modern methods of construction should become a greater part of this conversation. Providing lenders, consumers, and local authorities (among others) greater comfort around these types of homes is an important step in this process. On that score, I’m happy to report that our visit sparked some conversations for our members and hopefully a renewed look at modular homes.