Prefabricated housing, long seen as a niche alternative, is moving into the mainstream in Australia as major lenders and builders embrace factory-based construction.
The Commonwealth Bank of Australia (CBA) has introduced a progressive loan model tailored for prefabricated homes, addressing one of the sector’s biggest hurdles, finance during the off-site build.
Buyers working with an assessed manufacturer can now access up to 80 per cent of the contract price during factory construction, while non-accredited builds still attract up to 60 per cent.
A shift in the market
Prefabricated homes, ranging from modular and panelised builds to kit and flat-pack models, are created in controlled environments before being transported for on-site assembly. The approach allows precision, less waste, and dramatically shorter build times. Some homes can be installed in a single day, with overall build programs completed in 4-12 weeks compared to more than a year for conventional construction.
Modscape founder Jan Gyrn notes that while prefab homes are not necessarily cheaper to produce, “it’s that massive time-saving that’s pushed [the business] to quadruple in a few short years”.
Addressing housing supply
With Australia in the midst of a housing shortage, industry groups expect prefabricated building to triple over the next five years. Commonwealth Bank’s move is seen as pivotal, lowering barriers for families and investors alike.
In Queensland, CBA has also partnered with Oly Homes to fund a new 21,900-square-metre factory on the Sunshine Coast, expected to nearly triple the company’s output from 200 to about 550 homes annually.