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Why startups making cheap factory-built starter homes keep failing
- morsecodist 3y agoI have always been pretty skeptical of the value proposition of these companies. We have had prefab construction for decades and you could buy kit homes from the Sear's catalog in 1908. These methods are definitely useful but constructing the actual structures just doesn't seem to be the bottleneck in getting housing built. I often hear the lack of productivity growth in the construction industry used as a justification for why companies like this are needed but you could also interpret that as the absence of incentives to increase productivity. I am not quite sure what the bottleneck is, but it seems related to a combination of zoning, the ever-rising cost of land, housing's dual role as a commodity and an asset, a highly fragmented industry with perverse incentives, and interests entrenched by a combination of momentum and policy.