Councils will be encouraged to use modern construction methods such as factory-built modular housing to speed up the delivery of new affordable homes.
The Welsh Government's Housing Minister Julie James made the announcement as she unveiled a £45m investment to boost the growing industry in modern methods of construction (MMC).
The Welsh Government wants councils to build far more homes at scale and at pace; however, they face the well-documented capacity constraints faced by traditional house builders.
To deliver more homes quickly, councils will be encouraged to use MMC, which will help them build better quality homes faster than traditional methods allow, in order to meet the growing need for affordable housing across the country.
MMC includes various construction methods from new materials and technologies to off-site manufacturing, which either replace or complement traditional methods of construction.
MMC opportunities will also bring significant new benefits to the Welsh economy. To back Welsh business, ministers plan to help this next generation of homes to be built utilising national assets such as Welsh steel and Welsh timber.
There will also be a focus on using the emerging MMC industry in Wales to pursue Welsh social and ethical ambitions, including developing skills and market-leading technical expertise in communities hardest hit by the decline of traditional industries. Investment will also help firms invest in locally sourced labour.
Other benefits include:
- Creating new jobs and developing the new skills required to accommodate greater use of MMC, which will represent a sea-change in the construction industry;
- Upskilling the existing construction workforce;
- Attracting new and diverse entrants from marginalised groups such as offenders and those who wouldn’t necessarily consider careers in traditional construction such as women.
As part of the Welsh Government’s new MMC strategy ‘Reimagining social house building in Wales', ministers are making a major £45m investment in the modular housing industry in Wales, to ensure it can deliver the next generation of social housing that people need.
Of this, £20m is being made available for MMC businesses, who in partnership with Welsh social landlords want to build the next generation of social housing. This investment is designed to help and encourage the market, especially SMEs, to develop off-site manufacture (OSM) solutions such as supply chains, factories, and skills development centres, that meet the needs of the next generation of social housing in Wales.
A further £25m is being made available for round 4 of the Welsh Government’s Innovative Housing Programme, which will focus on innovative housing delivered through MMC.
The strategy supports the Welsh Government’s ambitions to reduce carbon emissions from the housing sector. It also supports a move to a circular economy, as building with MMC could reduce construction waste by as much as 90%.
The Housing Minister witnessed MMC in action on a visit to SO Modular in Neath, who already supply the social housing market in Wales.
Housing Minister Julie James said:
“Building more social and affordable homes is a key priority for the Welsh Government. Over the last 4 years, this Welsh Government has invested £2 billion in new housing across Wales, as part of our ambition to deliver 20,000 affordable homes by 2021.
“But we want to build more. And we want to build better. The significant investment we’re making in the modular housing industry will enable us to do that.
“Gone are the days of MMC’s association with poor quality, temporary, pre-fabricated housing; MMC now produces high quality, desirable and energy efficient affordable homes that tenants can be proud of. We have certainly moved from Pre-Fab to Ab-Fab!
“Developing the MMC industry in Wales presents us with a great opportunity to not only build beautiful new social housing, but also kick-start a new industry that will become increasingly important for our economy.”
The publication of the strategy is in response to a recommendation made by the Welsh Government’s Affordable Housing Supply Review, which identified Modern Methods of Construction as a way of more quickly increasing housing supply.
Community Housing Cymru, which represents housing associations in Wales, said it was pleased to see the strategy focus on sustaining the foundational economy in Wales by creating local jobs and using local materials.
Bethan Proctor, Policy and External Affairs Manager at Community Housing Cymru, said:
“Modern methods of construction (MMC) promote the building of good quality, low carbon, affordable housing at pace and scale, and with housing associations committed to building 75,000 new homes by 2036, this announcement will help make this a reality.
“There is already an appetite in the social sector to use MMC, and the Welsh Government’s strategy and investment will open the doors for many more to develop off-site manufacture approaches, helping to build healthier, decarbonised homes, tackling the housing and climate crisis.”
Joanna Davoile, Director of Development at Wales & West Housing, said:
“WWH is really pleased to see the £45m additional funding for MMC, and particularly that £20m of that is ear-marked to support delivery of social housing.
“The Welsh Government has set ambitious agendas to increase delivery of affordable housing and mitigate the impact of climate change. They are demonstrating their commitment to those agendas by offering funding and support for MMC.
“MMC could help to improve quality in construction and the energy efficiency of new buildings, reducing costs to residents and the carbon footprint. As part of our strategy to build 2,500 more new social homes for Wales in the next five years, WWH is already taking opportunities to work with MMC. We are using off-site manufacturing and panelised systems on several of our new development sites and we are keen to do more.
“The funding announced will help the construction industry in Wales stay at the forefront of innovations in MMC by supporting the development of the skills, supply chains, factories and products that will move MMC towards becoming a practical and affordable mainstream option.”
