Pre-fabricated or modular homes are built in factories and assembled on site, cutting construction timelines and costs. In 2023 McKinsey calculated that off-site housing production could cut project timelines by as much as half and knock a fifth off the cost. Factories that use automation are more able to withstand labour shocks during pandemics or deportation campaigns. Pre-fab homes are common in Japan and the Nordics but make up only about 3% of America's existing housing stock.
The American Enterprise Institute reckons America could be short roughly 6m homes. California's deficit alone is estimated at 1.8m. The median listing price in Altadena, a Los Angeles neighbourhood, was $1.2m in 2025—evidence of the state's self-inflicted housing crisis.
Climate change may be the industry's accelerant. After the Eaton Fire destroyed more than 16,000 buildings across Los Angeles County in January 2025, pre-fab homes enjoyed a surge of interest. The state of Hawaii is building 450 modular homes to temporarily house 1,500 survivors of the fire that razed Lahaina in 2023. Fire-resistant features—metal roofs, no attics, air filters—are a selling point.
Modular housing still carries a stigma. "People imagine a trailer," says Carol Galante of the Terner Centre for Housing Innovation at Berkeley. Yet uniform factory-built housing has American precedent: in the early 20th century, homes ordered from Sears catalogues dotted the country, and the tract houses of Levittown and Lakewood later followed the same logic.
The future is a myth created by insurance salesmen and high school counselors.