Prefab micro-units as a strategy for affordable housing

Abstract

Increasingly large cities find themselves with a scarcity of affordable housing stock and cannot increase inventory quickly enough to meet urban growth trends. Some limitations include, lot size, regulatory barriers as well as environmental concerns. We focus on these barriers, first providing a background on these trends in the United States and then offering cases of how these opportunities might be applied as supply-side solutions to housing market demands, specifically using prefab technology for the micro-unit typology. We then use a proforma-based approach to model the impacts of this combination. We find that combining prefabricated or modular technology with small unit design can be effective in increasing affordable housing production across markets, and that addressing limitations with zoning and providing additional financial tools can accelerate this trend.

Keywords:

• Affordable housing
• micro-units
• prefabrication

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 We use the terms prefab, factory-built and modular interchangeably in this paper as a general reference to units that are fabricated or constructed off-site.

2 Also see Apis Cor website, ‘3D Printing a Home for Under $10,000’, https://www.apis-cor.com/gallary

3 Unit A and Unit B floor plans courtesy of Hauser Architects.

4 The ‘Cubix’ project at 766 Harrison Street in San Francisco, constructed in 2006, presents the City’s first foray into mass-produced (98 units), architecturally beautiful, micro-homes (225 sq. ft. +) the size of a single room occupancy unit but containing full bathrooms, kitchens, and private outdoor space. The building deconstructed the traditional model of a house that includes a yard and living rooms and spread the single-family home elements across an entire building (ground floor commercial space as the living room, rooftop as the garden, patio, yard). The units were designed to permanently house San Francisco working professionals that live and work in the city.

5 San Francisco-based Zeta Communities focuses on using prefab, modular construction to design and develop cost-efficient, high-quality residential communities (http://www.zetacommunities.com).

6 http://www.bizjournals.com/sanfrancisco/blog/real-estate/2013/06/patrick-kennedy-to-sell-micro-units.html?page=all

7 http://www.panoramic.com/about/

8 Joseph Eichler was a real estate developer in the mid-1900s who built over 11,000 modern homes for the middle class in Northern and Southern California. The homes remain popular for their clean lines, open interiors, and abundant natural daylighting.

9 Note that while this policy may also be beneficial to non-profit developers, assuming that State and Federal grants remain available, the policy may not be as critical. According to non-profit developers interviewed as a part of this study, only a 2–3% margin is needed to break even on a project and sustain the viability of the organization. This usefulness of the policy could increase if the tradition grant and tax credit structure of many affordable housing projects is compromised due to Federal and State budget cuts being discussed in 2011. This could increase the importance of using a market-based approach to provide affordable housing units in walkable locations.