Offsite Construction
An Untapped Potential
If you’ve looked into building a new home, you may have come across terms like manufactured, prefab, modular, or panelized homes. However, these methods of construction have been slow to be adopted in the United States. You may not have seen any homes actually built using these techniques, despite their distinct benefits.
According to a 2023 report by McKinsey and Company, “[l]ess than 4 percent of current US housing stock was built using modular techniques, compared to 15 percent of homes in Japan, and 45 percent in Finland, Norway, and Sweden.” Clearly, other parts of the world are seeing value in offsite construction, and it’s only a matter of time before these technologies become more standard throughout the US.
We’d like to break down each of these options and discuss each method’s pros and cons to help you make an informed decision about what’s right for you.
Inside the factory that produces PANL kit components.
What is Offsite Construction?
Offsite construction is a catch-all term for buildings that are fully or partially constructed in a location that’s different from their final building site.
Oftentimes, this is a factory or warehouse, with a controlled indoor environment. The home, or components, are then shipped to the build site for final install.
This is an alternative to on-site construction, which is what you’d typically think of if you imagine a home being built. On-site construction means that all raw materials are individually brought to the job site, and built in-place. The most common type of residential on-site construction is stick (or stud) framing, but other types could include timber frame, log homes, or even masonry construction.
History of Offsite
When we think of offsite, or prefabricated homes, we often envision the classic mobile home, or “trailer house.” While this is definitely one form of offsite construction, the history of this construction method goes back much further, and has some interesting architectural roots.
A row of mobile homes, the typical idea of offsite construction.
Offsite construction became popular during the Gold Rush in the 19th century US as a way for prospectors to quickly build homes when heading to California. Later on, the Sears Catalog Home became a popular option around the United States. At PANL, we actually have multiple family members who have lived in Sears Catalog Homes. As a fun anecdote, my grandma lived in one in central Ohio that was built at a time when the individual components were shipped via train and then brought to the build site with horses!
Sears homes were designed to feel like a traditional home in any style - they sold hundreds of different designs using the system. On the other end of the spectrum, famous architect Frank Lloyd Wright also looked into offsite construction as a way to bring his unique designs to the masses. His ASB (American System Built) homes utilized precut components that were prepped in a factory and then quickly and easily assembled onsite. Later on, through his Usonian designs, Frank Lloyd Wright developed the “Automatic” home using modular concrete blocks. According to the National Park Service, “‘Automatic’ was used to suggest that the owner might participate in the actual construction of the home, laying or even making the blocks.”
Drawings of one of Frank Lloyd Wright’s ASB homes.
The key takeaway here is that offsite construction was originally intended to improve the speed, consistency, and affordability of home building without sacrificing design or comfort.
We’ll go more into how PANL is working to uphold this vision later on.
Today’s options
Today, offsite construction has evolved to include a ton of options at every price point, and each comes with their own pros and cons. Overall, the biggest rationale behind offsite construction today is that homes can be built with higher consistency and less waste when constructed in a factory setting. Materials, logistics, and building processes can be optimized, which makes labor more efficient and timelines easier to follow. Weather isn’t a factor during the manufacturing process, which helps protect the individual components. However, there are finer details separating the individual options under the offsite umbrella. We’ll cover three very common off-site options next – Pre-fabricated, Modular, and Panelized.
Interior of a prefabricated home.
1 - Pre-fabricated
Fair warning: this may get a bit confusing, since technically any of the options below could be considered “pre-fabricated” depending on who you talk to.
For the sake of this overview, we’re referring to “fully” pre-fabricated homes, which means the home is completely built and finished in a factory. These homes are typically put onto the back of a truck, and then craned onto a foundation or have adjustable piers for placement on their final site. Once they’re off the truck and connected to utilities, construction is finished.
Pros:
Fast install - installation of these building can take less than a day, and often only requires utility hookups on-site
Fixed cost - with everything including finishes done in a factory, these units have a fixed price that can be shared upfront. The only variable costs are typically related to shipping and utilities on-site.
Cons:
Size and aesthetic - because these units need to fit on a truck for shipping, they are usually a long, skinny rectangle, with a max footprint of around 650 sqft or less.
Fit and finish - because these units must be shipped and craned from a truck, the final weight of the home must be considered, meaning finishes are often “RV” quality. Our personal opinion is that this equates to flimsy, temporary feeling materials throughout to reduce overall weight.
Lead time - depending on the unit and supplier, manufacturing these can take many months in the factory since they are fully pre-finished
Limited customization - by eliminating on-site construction entirely, you’re likely unable to make any changes to finishes or the final design during the process. What you buy is what you get.
A modular home component is craned into place.
2 - Modular
As a way to get around some of the constraints of fully pre-fabricated homes, modular has become a popular option for those looking for a blend of efficiency with larger floor plans.
Modular homes are made up of multiple pre-fabricated components that are attached at the building site to create the final home.
Pros:
Fast install - Installation on-site is typically longer than full prefab, but can still be as quick as a week once on site depending on the supplier.
Size flexibility - Size can technically be unlimited, since you could add as many modular pieces together as you’d like. Your primary limitations will come from the build site, your budget, and zoning or code restrictions.
Fixed cost - while potentially more variable than fully pre-fabricated, modular construction can still provide relatively upfront pricing on the building components. Foundations may need to be more substantial than fully pre-fabricated, which can create significant pricing fluctuations.
Cons:
Design aesthetic - while modular pieces can create more interesting layouts, they are still each constrained in the same way as fully prefab homes. Every modular piece must fit on a truck, meaning you usually end up with a combination of long, skinny rectangles.
Fit and finish - just like fully pre-fabricated homes, shipping weight is still an issue that can force the use of lower quality finish materials.
Lead time - these often have a manufacturing lead time in-line with fully pre-fabricated homes.
Limited customization - Just like fully pre-fabricated homes, you may have some upfront design options, but once manufacturing begins, you have little to no design flexibility.
Wall panels are craned into place.
3 - Panelized
Panelized construction is a hybrid between modular and traditional construction, aiming to provide some of the benefits of both. Panelized means that individual wall and/or roof pieces are made in a factory, allowing for quick assembly on-site, but still using some on-site labor as opposed to craning a finished building onto the site.
This can be considered more analogous to building with Legos - it’s simple, but provides relatively unlimited design options. Sub-categories of panelized construction include stick-built panels, structural insulated panels, and prefab concrete panels, which we’ll cover in a later blog post.
Pros:
Quick, consistent assembly - while these pieces do require on-site assembly, it’s much quicker than stick framing, and minimizes the use of tools or labor to build homes efficiently and with very little waste.
Design flexibility - panelized homes can come in any style, at any size. There are no limitations on what can be built in terms of home layout or aesthetics.
Energy efficiency - most panelized homes include high-end insulation and tight building joints, allowing for increased air quality while minimizing utility needs.
Fit and finish - because wall components are separated from the finish materials and mechanicals, building weight is far less of a constraint compared to fully pre-fabricated and modular homes, meaning you can pick whatever finishes you like for your home.
Cons:
On-site construction - if you’re looking to have your home built in a day, panelized probably isn’t the best option. Panelized construction can often be up to 2x faster than traditional, but this still usually equates to months of construction on-site, not days or weeks.
Variable pricing - because finishes and labor are more variable than modular or prefab, the final price of your build may be more project and location dependent. This means it’s difficult for manufacturers to provide a universal upfront total build cost beyond the cost of their panels.
The PANL difference
The PANL Beta Test house in Central Ohio.
As you can likely guess, PANL is most easily categorized under panelized construction (hence the name, PANL). We send flat-stacked wall and roof panels of our pre-designed homes, which are assembled on-site to create the physical shell of the home. However, there are a few things that separate us from other alternatives that we feel make us a great option for many of those looking to build a home:
Design - we’re designers at heart. Many of the prefab, modular, or panelized options on the market have only prioritized engineering and efficiency, without considering the value of home architecture. We share the efficiency and functionality of our competitors, but we feel that we offer a far superior building aesthetic.
Simplification - Our assembly instructions are designed to be easy enough for anyone from non-English speakers to DIYers to feel comfortable working with PANL. Everything is clearly labeled, visually based, and straightforward. This equates to faster, less stressful builds.
Floor plans - we are focused on providing more open, modern, and minimal options than others in the market. Many competitors we’ve seen provide a maze of small rooms and separated spaces. We want to create right-sized spaces where people can still gather, inside and out.
Finishes - we provide the ultimate combination of beautiful, easy finish design and options to customize. By purchasing one of our PANL Spec Books, you are able to work with our best-in-class partners to directly order everything you’ll need to finish your PANL space. We’ve hand selected every item to fit certain aesthetic, quality, and sustainability requirements. But, you can also work with our partners to change any individual components (think a single light fixture or a hardware finish) to get your home exactly how you’d like it. And in most cases, you’re receiving pro-pricing on these items thanks to our great partnerships.
When we started PANL, we aimed to find a balance between the quality and beauty of modern, custom homes, with the sustainability, efficiency, and cost-effectiveness of off-site construction. We feel that our homes do just that, and we think you’ll feel the same way. If you’re still looking for more about how PANL works, we’d invite you to check out our process page and FAQs.
If you have a specific model you’re interested in, you can find more detailed drawings and helpful construction-related information in our starter guides. The price of your starter guide will automatically be applied to the purchase of a PANL kit if you decide to move forward with us at a later date.
We’d love the opportunity to help you build your dream home.
Best,
Carlin + The PANL Team
