Modular Homes as a Solution to the Housing Crisis

The housing crisis has been a pressing issue in Ontario for several years now, with rising prices and low availability making it increasingly difficult for residents to find affordable and suitable housing. In response to this, modular homes or housing have emerged as a potential solution that could help address these challenges and provide a more sustainable and efficient way to build homes in the province. 

With the 2022 More Homes Built Faster Act, Ontario was looking to use surplus or under-utilized lands as well as building technology to meet its goal of building at least 1.5 million new homes by 2031. 

The government of Ontario is developing a modular housing framework to help meet housing demands and position the province’s construction industry to be a leader in innovative housing construction, said Paul Calandra, the Minister of Municipal Affairs and Housing. Toronto approved the construction of its first 250 modular homes on city-owned sites in 2020 and 2021. Since then, Toronto has completed 216 modular homes.

What is Modular Housing and What Does It Look Like?

Modular housing, also known as prefabricated or factory-built housing, involves constructing individual units or modules off-site in a factory and then transporting them to the final location for assembly.  The interior of a modular house is finished or almost finished at the manufacturing facility. For example, wiring and plumbing can be installed in the modules before being moved to the building site. This method of construction offers several key advantages over traditional on-site building, including lower costs, shorter construction timelines, and reduced environmental impact. The main difference between modular houses and conventionally built houses is the construction and delivery process.

One of the main benefits of modular housing is its cost-effectiveness. By building the individual modules in a controlled factory environment, costs associated with weather delays, onsite labor, and material waste are significantly reduced. This can result in savings of up to 20% compared to traditional construction methods, making modular housing a more affordable option for both developers and homebuyers.

Additionally, modular housing can be built much faster than traditional homes, with some projects being completed in as little as half the time as regular construction. This rapid construction timeline can help address the urgent need for housing in Ontario and provide a quicker solution to the growing housing crisis. In a province where housing supply is struggling to keep up with demand, modular housing offers a viable solution to expedite the construction process and deliver much-needed homes to residents.

Another added benefit of modular housing is  that it is also more environmentally friendly than traditional construction methods. By building the modules in a factory setting, waste generation is minimized, and materials can be recycled and reused more efficiently. Additionally, the energy efficiency of modular homes can be optimized during the manufacturing process, leading to lower utility costs and reduced environmental impact over the lifetime of the home.

What Are the Advantages of Buying a Prefabricated/Modular Home?

One of the advantages of buying a  prefabricated house is the quicker construction time. These homes are built within a controlled factory environment using dry materials, resulting in superior structural strength and minimal expansion and contraction issues often associated with site-built structures.

In addition to providing affordable housing options, modular housing can also help address the issue of homelessness in Ontario. The city of Peterborough started a pilot  project of building modular homes to help with their homelessness. By quickly assembling modular units in strategic locations, cities and municipalities can create temporary or permanent housing solutions for individuals experiencing homelessness. This rapid deployment of modular housing can help alleviate the strain on emergency shelters and provide a more dignified and secure living environment for those in need.

Some companies are full service and manage every step of the process, taking on the role of general contractor, including:

• getting the necessary permits

• creating custom interior/exterior designs

• providing foundations or building a fully finished basement on your lot

• arranging for transport and installation of the modules on the lot foundation

• completing assembly and finishing work on your lot

Some companies even complete the landscaping on your property.

In Ontario, most purchasers of newly built homes are entitled, by law, to warranty coverage from their builder under the Ontario New Home Warranty and Protection Plan. This warranty plan covers problems with workmanship, water damage and other major structural issues. It also provides deposit protection and delayed closing/occupancy compensation.

Almost all newly constructed homes in Ontario have statutory warranty coverage of up to $300,000 over a seven-year term. The warranty remains with the home for seven years, even if it is sold during this period.

Despite the many benefits of modular housing, there are still some challenges that need to be addressed in order to fully realize its potential in Ontario. One of the main barriers is the perception of modular housing as being less durable or aesthetically pleasing than traditional construction. However, advancements in design and technology have allowed for greater customization and architectural flexibility in modular homes, making them indistinguishable from their site-built counterparts.

What Is the Cost of a Prefab Home Kit in Ontario, Canada?

While the total cost of a prefabricated home is highly variable based on size, amenities, cost of lumber, and location, you can expect to pay between $180 and $250 CAD per square foot – this amount that often includes interior fixtures.

Bill Allen, owner of Wholesale Housing in Stouffville, Ontario believes that modular housing can save new owners a sizeable amount of money. 

“In the last few years we’ve found a growing interest in our products, especially the garden suites, which are  700 square feet up to 1,100 square feet.  All homes  average about $225. a square foot. delivered to Matheson area - roughly ½ the cost to build in the Northern Ontario communities.  In the Toronto area our bungalows (1165 s.f. to 1717 s.f.) save the customer about $150,000. over the cost to build the identical home on site and most are installed in a week.  We expect the cost savings in Northern Ontario will be greater”.   

In conclusion, modular housing has the potential to revolutionize the way homes are built in Ontario and provide a sustainable solution to the housing crisis. By offering cost-effective, efficient, and environmentally friendly construction methods, modular housing can help address the shortage of affordable housing options and provide a quicker response to the growing demand for homes in the province. With continued support and investment, modular housing has the opportunity to make a significant impact on the housing landscape in Ontario and create more inclusive and resilient communities for residents.

Want to read more about alternative housing options? Then check out these articles:

• Building a Tiny House: Permits and Municipal Regulations

• How Much Does a Tiny House Cost?

• Expectations vs. Reality: Living in a Tiny House