This was the conclusion of a letter from the House of Lords Built Environment Committee, sent to the government in January 2024. The committee undertook an inquiry into the future of MMC due to several Category 1 MMC companies collapsing and closing during 2022 and 2023.
Lord Moylan, Chair of the Built Environment Committee, noted that the success of MMC in other countries, and in the UK with other building types, has “thus far eluded the building of MMC homes in meaningful numbers.”
A change of government has shown no signs of improving Category 1 MMC housebuilding
Seven distinct categories of MMC have previously been defined by a government working group. Five relate to different types of pre-manufactured solutions, with Category 1 being 3D primary structural systems (more commonly known as volumetric modular). The sixth and seventh categories address labour reductions and productivity improvements on site, through traditional product-led and process-led approaches.
Category 1 MMC housebuilding represents an opportunity to deliver factory-built, modular homes that are cost effective, of consistent quality, and delivered on site quickly. They depend less on skilled labour, which is critical at a time when the construction industry is facing a skills crisis.
The UK needs a new way to deliver large numbers of new homes. Previous governments consistently set a target of 300,000 new homes a year, which never came close to being met. Despite this, the new government has repeatedly promised to build 1.5 million homes over the next five years, since coming to power in July 2024. And yet, as Lord Moylan observed in an Inside Housing article in October 2024, a change of government has not alleviated the Built Environment Committee’s concerns, as set out in its letter.
What issues prevent Category 1 MMC from succeeding?
The drivers are there for MMC housebuilding to succeed. As well as housebuilding targets, Skills England says adoption of MMC needs to “expand considerably” to have a meaningful impact on current labour shortages. But it also notes that unpredictable profit margins restrict the construction industry’s ability to invest in skills and innovation.
As factory-based operations, Category 1 MMC companies need a consistent pipeline. Without a consistent and predictable level of demand, these companies cannot succeed – and those pipelines are still not there. Without the right level of demand, companies’ operations cannot be scaled up.
Scaling up is one ‘S’ of Homes England’s “five-S” approach to support MMC, alongside standardisation, safety and assurance, soft levers, and stimulating the market. However, the Built Environment Committee found that Homes England’s approach “has no clear objectives, no metrics with which to measure success, and no timescale for implementation.”
The Committee found that the private sector is not creating sufficient demand for Category 1 MMC housing. This is, arguably, at odds with the commonly cited problem of slow planning approvals creating pipeline ‘blockages’.
Currently, planning approvals are at their lowest since records began in 1979. Yet, as BBC News writes, the new government’s much-vaunted plans to reform planning rules may only go so far in driving an increase in housebuilding. Because most new homes in the UK are delivered by a few volume housebuilders, a better planning system will not necessarily encourage them to build on their sites any faster.
What does the government need to do to support MMC housebuilding?
According to the Built Environment Committee, substantial financial investment has been provided to the MMC sector without clear objectives for how the money should be used. Despite this, the inquiry found that often stated housebuilding targets simply won’t be met without a contribution from the sector.
Achievable goals and a coherent strategy are key to delivering more housing using Category 1 MMC. The government must ensure it achieves value for money from its investment in the sector, but progress is hard to establish because there is a lack of data about the use of MMC. Therefore, this must also be addressed.
Data is also an issue where warranty and insurance providers are concerned. Many are unwilling to accept compliance with the Building Regulations as sufficient, but the industry is not collaborating to gather the data it needs to issue warranties or insurance. The government should communicate a clear expectation to the sector to do this, which would support the delivery of MMC housebuilding.
How products like Arctek® Dryshell™ can support Category 1 MMC housebuilding
With the right conditions in place, the MMC sector is well capable of helping to accelerate UK housebuilding. The sector needs to be ready to capitalise on any improvement in conditions, and that means having solutions available to adopt as part of home design and specification. An example of such a solution is Arctek® Dryshell™, an integrated weather resistant barrier for OSB sheathing boards, created by Arclin.
The overlay provides high levels of performance and is a continuous and factory-applied solution that ‘fuses’ to OSB, allowing it to be used in both onsite and offsite construction methods. With Arctek® Dryshell™ a simple taping between panel seams is all that is required, and with no tricky installation details usually associated with traditional housewraps, there is no risk of rips or tears, so no moisture or dirt can get into the construction.
Arctek® Dryshell™ helps timber framed housing manufacturers and suppliers to make improvements to their processes and take greater advantage of the growing timber frame market in the UK. To find out more about how Arctek® Dryshell™ can benefit your timber framed housebuilding projects, request a sample or contact us with an enquiry.
