Governments in New Zealand, Australia, the UK, the US and Canada are all trying to get more homes built in factories. New rules, certification schemes and funding have arrived over the past two years. If you work on site, this changes where some of the work happens and what skills are in demand.
What prefab and modular building means
Prefab, modular and offsite construction all mean the same basic idea. Parts of a building are made in a factory, then trucked to site and put together. In the UK and Australia this is often called modern methods of construction, or MMC.
It can be as small as wall panels and roof trusses, or as big as whole rooms, bathrooms or complete small houses.
New Zealand: BuiltReady and granny flats
New Zealand has a voluntary scheme called BuiltReady. It certifies manufacturers whose modular components meet the Building Code. MBIE says the aim is faster and more consistent consenting for factory-made parts. MBIE also says officials are now looking at the scheme’s future role as part of wider building law reform.
The bigger change for many tradies is granny flats. The law allowing a building consent exemption for small stand-alone homes passed on 15 January 2026. Key points:
- Single-storey, stand-alone homes up to 70 square metres.
- You must get a Project Information Memorandum from council before work starts, and tell council when you start and finish.
- Work must be done or supervised by licensed building professionals.
- Final plans, records of work and certificates must be given to council at the end.
Small, simple homes like these suit factory building, so expect more prefab granny flat suppliers to be active.
Australia: funding and a national certification scheme
The federal Budget in March 2025 included 54 million dollars for prefab and modular housing. This was 49.3 million dollars to grow the industry and 4.7 million dollars for a voluntary national certification process for offsite construction.
The Australian Building Codes Board has been asked to develop that national voluntary certification scheme for prefab manufacturers. It is also working on consistent definitions of prefab construction for the National Construction Code. The scheme was still being developed at the time of writing.
United Kingdom, United States and Canada
- United Kingdom: A House of Lords Library briefing in August 2024 said about 8 percent of UK homes were built using MMC, based on 2022 figures. Homes England has required its strategic partners to deliver at least 25 percent of homes in its affordable homes programme using MMC. The same briefing noted that some modular manufacturers have failed financially.
- United States: In June 2026, HUD proposed letting upper floors of multi-storey manufactured homes be built without a permanent steel chassis. HUD estimated this could save 4,800 to 6,700 US dollars per home. In October 2026, HUD announced a plan to update manufactured housing rules, including safety and energy standards.
- Canada: The federal agency Build Canada Homes launched in September 2025. In February 2026 it asked modular, panelised and prefab builders to register their interest. It says the projects it backs will favour Canadian materials and factory-built housing, and it plans a list of approved suppliers.
What it means for site trades
Prefab does not remove site work. Someone still has to do the groundwork, foundations, crane lifts, connections and finishing. But the mix of work changes.
- Foundations need to be accurate. Factory modules leave little room for error. Levels and set-out must be spot on.
- Connections are a job in themselves. Plumbers and electricians may spend more time connecting services between modules than running them from scratch.
- Some work moves indoors. Factories need builders, plumbers, electricians and finishers too, often on regular hours and out of the weather.
- Paperwork changes. When parts are certified in the factory, the on-site inspection and sign-off may focus more on installation and connections.
- Risk of supplier failure. The UK experience shows some modular firms have gone under. Check a supplier’s track record before you rely on them.
What it means for your business
- If you do foundations or groundwork, talk to local prefab suppliers. They need reliable crews who can hit tight tolerances.
- For NZ builders, learn the granny flat exemption rules. Simple prefab homes up to 70 square metres could be steady work.
- Plumbers and electricians should get familiar with the connection details used by the main local manufacturers.
- Before signing with a prefab supplier, check their history, certification and how you get paid if things go wrong.
- Keep an eye on certification schemes in your country. They will shape who signs off what on site.
Sources
- BuiltReady, Building Performance, MBIE
- Granny flats building consent exemption becomes law, ITM (Building Performance article)
- Property Council: Federal prefab housing cash hits innovation sweet spot, Property Council of Australia
- Prefabricated, modular and offsite construction, Australian Building Codes Board
- Modern methods of construction in the housing industry, House of Lords Library
- HUD proposes changes to manufactured housing definition to promote multistory construction, Orrick InfoBytes
- HUD announces plan to modernize manufactured housing, Lewis County Herald
- Build Canada Homes launches Request for Information on Modern Methods of Construction, Government of Canada
This article is general information based on sources available in October 2026. Rules, prices and figures change, so check the current details with the official source where you work.