Blog Post

Embracing innovation in construction

Embracing innovation will be an imperative to sustain housing delivery in London – but first we need to remove the barriers.


There has been much debate within the housing and construction industry on whether the Mayor’s target of delivering 65,000 homes is achievable, let alone realistic. However, after years of under-delivering, it is undeniable that we need to dramatically increase the availability of quality, affordable homes for Londoners.

The causes of our housing shortfall has been manifold; the “where” and “what” we build – the land, development and planning decisions which have been the subject of much research and discussions –  and the “how” we build. The latter – how we build and what construction methods we use – has been part of what has hindered housing delivery in London, although less prominent in debates.

The current construction model is often criticised for producing poor-quality building and high costs. That is why the transition to Modern Methods of Construction (MMC) – off-site, precision manufactured homes – is an imperative if we are to get close to delivering 65,000 homes a year.

Our new research considers how innovations in housing construction and manufacturing could improve the speed, scale, and quality of housing delivery across the capital.

Through interviews with developers, local authorities and housing associations, we identified five key hurdles preventing the adoption of modern methods of construction:

1. Immature supply chain

Realising the economies of scale that MMC could offer requires volume and continuity of demand.  But the current modular market in London is immature. Supply chain inefficiencies inhibit the development of a scalable business model and inflate costs. While some developers are setting up their own factories, or buying out their suppliers to ensure stability and scalability of supply, this is not widespread.

2. Industry culture

Our research suggested that a lack of collaborative partnerships and trust within the construction industry is hindering the development of innovation. In their current form, the fragmented and lengthy nature of supply chains makes collaboration within the construction sector hard to achieve.

3. Planning System

Some interviewees also expressed frustration with the planning process, which they perceived as rigid and unaccommodating to MMC. This was particularly the case with projects of a smaller scale, and with specific aspects of MMC such as construction employment being off-site rather than local. And on design, planning policy starts with the presumption that new development should broadly fit with its context. In many parts of London, this can lead to brick buildings.

4. Lack of guidance and standardisation of design

There is a sense that the use of MMC risks restricting architectural freedom, but our research found that this was not always the case. Architects that we interviewed said they favoured the greater control that MMC affords during the initial design process, while others pointed to the fact that it allowed greater customisation of home design by the homebuyer.

5. Perceptions

Pre-fab homes have had a bad rap since the Second World War. Prefabricated houses built during this period were often low density and poor-quality, partly due to their planned temporary status. Many people remain sceptical and think that MMC creates unattractive, poor-quality and disposable housing, even though elsewhere in Europe, MMC has grown in popularity.

How can we scale up?

To realise the potential of MMC, housing providers, industry bodies and the Mayor – using his devolved powers – should invest in up-skilling workers for the transition to MMC and in construction skills more broadly as although modern methods of construction are less labour-intensive, they will still require skilled workers.

Bringing modern methods of construction to the forefront of housebuilding in London will also require developers to accelerate their adoption of MMC; and councils and housing associations should pool expertise and purchasing power to form an MMC buying club, which would allow them to build at scale across multiple London boroughs the homes London so desperately needs.



Victoria Pinoncely is Research Manager at Centre for London. Follow her on Twitter.