Modular house builders going bust

[LnP]

The attached article mentions some modular house builders going bust or closing factories. The article is about volume building rather than self-build, but I wonder, are the self-build timber frame companies experiencing similar financial challenges? Should we be any more worried than we were before about a deposit being lost?

The companies mentioned are Ilke Homes, House by Urban Splash, Legal & General, Modulous, Lighthouse and TopHat.

 

"the government's approach to modern methods of construction in disarray" ....? Surely not.

 

https://www.theconstructionindex.co.uk/news/view/government-rethinks-volumetric-housing-support

[nod]

We’ve had a couple of jobs held up due to TF companies going into administration 

and Scottish building company Stuart Milne have gone also shutting three sites local to me 

 

A lot of companies are left quite exposed A site I’m doing the render on has a million pounds of quick stage Scaffolding Which hasn’t been enough to keep in front of us and the Brickies 

They bought at the height and will have to sell half of it at a loss when the site finishes in December 

[Kelvin]

Knowing what I know now I’d never build a timber kit or any construction method where you are financing the build up front if there’s no financial protection in place. 

[Andehh]

4 minutes ago, Kelvin said:

Knowing what I know now I’d never build a timber kit or any construction method where you are financing the build up front if there’s no financial protection in place. 

 

I totally agree. Its just too much a risk with the money and time involved.

[nod]

3 minutes ago, Kelvin said:

Knowing what I know now I’d never build a timber kit or any construction method where you are financing the build up front if there’s no financial protection in place. 

100%
 

One of the TF companies was still taking orders But we new that we were on stop for the second faze 

[SBMS]

39 minutes ago, Kelvin said:

Knowing what I know now I’d never build a timber kit or any construction method where you are financing the build up front if there’s no financial protection in place. 

Can you elaborate? What do you know now?

[Kelvin]

1 hour ago, SBMS said:

Can you elaborate? What do you know now?

When I signed the contract for our timber kit I hadn’t fully appreciated the financial exposure we’d let ourselves in for. It wasn’t clear in the contract that for several months the timber kit company would have 80% of the total kit price. I tried to get them to put some kind of financial protection in place in case they went bust and despite them saying they would look into it they never did. Fortunately it turned out fine and the kit turned up etc. However during that period three companies went bust with clients losing significant sums of money (some documented on here) so my fears about it were real enough. 
 

There are a few kit companies that put your money in Escrow so you have protection and I’d only do it that way in future or stick build on-site as I’d at least own the materials regardless. 

Edited April 1 by Kelvin

[Alan Ambrose]

At least one has you, at least, owning the materials before delivery. That’s some protection although how well it works in practice I can’t say. There have been several threads here on BH which covered escrow. I think we should all demand it for these purchases. I’ve shown the calcs before, not crazy expensive.

[MikeSharp01]

Yes Berkely Homes has also closed its very hi-tech factory in Dartford because it cannot make it pay, and they are volume house builders so industrialisation should be a natural progression. How come we managed to make this work in the 1940's but seem unable to make it work today with all the advanced technologies that could be applied.

 

[SteamyTea]

44 minutes ago, MikeSharp01 said:

How come we managed to make this work in the 1940's but seem unable to make it work today with all the advanced technologies that could be applied.

Because of the designs used, they were perceived as temporary caravans/beach huts.

I have an American mate who worked in an architects office for many years (did the model making/photography) and when she moved to the UK she heard the term "put all your money into bricks and mortar" for the first time.

She still finds it an funny saying and often says it when conversation about our class system crops up (which is quite often when an American is in the room).

 

We seem to have designed a housing system and sell it as a privilege to be a home owner, if you cannot get on the housing ladder it is because of personal failings i.e. you own a phone, have a coffee in a cafe.

[MikeSharp01]

22 minutes ago, SteamyTea said:

you own a phone, have a coffee in a cafe.

Or eat too much Avocado! I had some elderly relatives lived in one of the Wandsworth pre-fabs and they said they loved it and he was a construction professional - structural engineer. I stayed there for a short while when I was about 8 and had a great week - some of the kids in the street still lived in bomb damaged houses just along from it.  

[SteamyTea]

1 minute ago, MikeSharp01 said:

Or eat too much Avocado

Plant the stones and in a few years you can be harvesting your own crop (I have a few planted in pots and may plant them properly one day).

[LnP]

2 hours ago, MikeSharp01 said:

Yes Berkely Homes has also closed its very hi-tech factory in Dartford because it cannot make it pay, and they are volume house builders so industrialisation should be a natural progression. How come we managed to make this work in the 1940's but seem unable to make it work today with all the advanced technologies that could be applied.

 

I spent my first 11 years in a prefab at the Atomic Energy Research Establishment at Harwell. My parents moved into it just after the war in the very early days of the AERE. They were very proud of it. The kitchen had a built in fridge and a clothes boiler/mangle contraption. The hot water was heated by a back boiler behind the fire place in the living room as well as an immersion heater. There were built in cupboards and wardrobes throughout (steel doors). Unimaginable luxury for my mother who had been bombed out of the East End of London. My father used to say it had been designed by engineers, but he was an engineer so he would say that. They were manufactured by the Bristol Aeroplane Company and erected by Italian prisoners of war who had decided to stay in the UK after the war.

 

We talk a lot about timber frame on this forum, but shouldn't forget that there have also been unsuccessful attempts to introduce light steel frame construction into the UK residential market. And yet we are still building houses using the technically inferior bricks and mortar system.

[Kelvin]

No surprise that UK houses are generally poor compared to every other developed country. It does mean a good  self-build is light years ahead of just about anything else that gets built. 

[SteamyTea]

7 hours ago, LnP said:

spent my first 11 years in a prefab at the Atomic Energy Research Establishment at Harwell

Did you glow when it was cold.

 

[Guest28]

Some of these modular housing companies are basically selling glorified sheds for high prices.

 

I would never pay for a house that has timber clad walls and sheet roofing like a lot of them have, they will be rotten and full of water ingress in about 15 years. I would build one that has block walls and a slate roof.

[Kelvin]

So you keep saying. I had an actual shed that was still fine after 15 years. 

[saveasteading]

2 hours ago, MBT6 said:

glorified sheds 

There's nothing wrong with timber if the detailing is good.

Have you experience of problems or is this a perception?

[IanR]

On 01/04/2024 at 20:33, LnP said:

The attached article mentions some modular house builders going bust or closing factories. 

 

I see this as a specific issue with Modular house process.

 

As a comparison to cassette/panel kits it incurs higher costs for larger warehouses to build large boxes (of air), higher shipping costs to transport those boxes of air and higher crainage costs to move those boxes from transport into position.

 

I've never understood the benefit of the modular method.

[ProDave]

On 02/04/2024 at 09:17, LnP said:

I spent my first 11 years in a prefab at the Atomic Energy Research Establishment at Harwell. My parents moved into it just after the war in the very early days of the AERE. They were very proud of it. The kitchen had a built in fridge and a clothes boiler/mangle contraption. The hot water was heated by a back boiler behind the fire place in the living room as well as an immersion heater. There were built in cupboards and wardrobes throughout (steel doors). Unimaginable luxury for my mother who had been bombed out of the East End of London. My father used to say it had been designed by engineers, but he was an engineer so he would say that. They were manufactured by the Bristol Aeroplane Company and erected by Italian prisoners of war who had decided to stay in the UK after the war.

 

We talk a lot about timber frame on this forum, but shouldn't forget that there have also been unsuccessful attempts to introduce light steel frame construction into the UK residential market. And yet we are still building houses using the technically inferior bricks and mortar system.

I know them well.  My BIL used to live in one, until they were forced out when they were all being dismantled (he ended up buying his AERE house in Wantage)  They were very cold, and no doubt contained a lot of asbestos in their construction.

 

I often said, and I believe the residents committee argued for selling them to the tenants as individual building plots, but the authority had other ideas.  Half the Diamond project sits on one of the prefab sites now.

[saveasteading]

1 hour ago, IanR said:

I've never understood the benefit of the modular method.

I supppose there are different definitions of modular.

Perhaps you mean ready-made rooms that bolt together. Yes there is a lot of void tto  transport but it can be handy where space or  time are in short supply.

My definition is made off site, in factory conditions, to standard details.

These are the advantages. 

This perhaps creates extra cost,  perhaps not, depending on how the speed and certainty are valued.

1 hour ago, IanR said:

higher costs for larger warehouses to build large boxes (of air),

Not really. They can be made in small grotty old factories and made / shipped without taking much space. It is just a couple of saws then nailing wood together then whatever services might be wanted at that stage.

[LnP]

5 hours ago, MBT6 said:

Some of these modular housing companies are basically selling glorified sheds for high prices.

 

I would never pay for a house that has timber clad walls and sheet roofing like a lot of them have, they will be rotten and full of water ingress in about 15 years. I would build one that has block walls and a slate roof.

There are plenty of timber frame houses with wood siding, plywood sheet roofs with cedar shingles in Canada and the US which are more than 100 years old. There's nothing wrong with this method of construction if it's done properly and maintained, which is true for any building system.

[MikeSharp01]

41 minutes ago, saveasteading said:

It is just a couple of saws then nailing wood together then whatever services might be wanted at that stage.

Yes but heading for robots and all kinds. The ones I have seen in UK and Germany have robots assembly cells, CNC wood cutting etc. Old shed won't cut it, pardon the pun. going forward. We need to invest in automation so fewer people can get more done - for the mass market. I am the robots on our build.

[ProDave]

I did some work as a subcontractor for a local modular building company here. Their houses were not cheap but they were addressing the almost passive house end of the market making very well insulated houses.

 

Building them as pre wired and pre plumbed modules gave the problem of how to join the wiring together at the joints between the modules.  We never got any better than a junction box full of wagos that then got hidden.

 

I parted company with them, amicably because they wanted a full time electrician but I did not want full time work.  They since went bust.

[Iceverge]

9 hours ago, MBT6 said:

Some of these modular housing companies are basically selling glorified sheds for high prices.

 

I would never pay for a house that has timber clad walls and sheet roofing like a lot of them have, they will be rotten and full of water ingress in about 15 years. I would build one that has block walls and a slate roof.

 

 

Maybe. Maybe not. 

 

 

https://www.visitnorway.com/listings/stålekleivloftet-one-of-the-oldest-wooden-buildings-in-the-world/207516/