Modular Construction Delivers Price-certainty In Uncertain Times

The price of building and renovation projects has skyrocketed in recent years, in some cases by as much as 25%. Unfortunately, the figures are likely to climb further as companies inflate project costs to cover themselves. The reality that projects will inevitably be completed over budget and behind schedule is all too common, but modular builders like Modscape are bucking the trend.

Typically, contracts are signed with a fixed price. This is a common requirement of lenders, with the intention of protecting consumers. Often, the contract doesn’t allow for increases due to the rise and fall of materials and labour costs. However, the cost of building materials has only gone up in recent years, which poses problems for builders and customers alike.

‘The pipeline of construction approved during COVID is still being worked through and there’s been a number of major weather events… which require significant rebuild and repair work. This all adds additional demand-side pressure for construction materials and trades,’ explains Tim Lawless, Research Director at CoreLogic.

‘There’s also no reprieve on the supply side either with a lack of materials, elevated fuel costs and broader inflationary pressures. All of these factors have an impact and are likely to push building costs higher for some time yet.’

Further proof of this price hike can be seen in data from the Victorian Building Authority. The average Victorian housing project costed $245,000 as of late-2020. Fast forward a year, and the figure has jumped by 28%, up to $313,000.

Unsurprisingly, cautious builders are bumping up project costs as a contingency to protect against future price increases.

How Modular Provides Pricing Certainty and a Fixed Cost

We’ve all heard horror stories of what we like to call the ‘Grand Designs’ experience: architectural drawings coming in way over budget, price blowouts and timelines not adhered to – and these have only become more common in recent years. Odds are, those who have built traditionally have probably experienced this.

At Modscape, our modular approach allows us to guarantee a fixed cost from the second the contract is signed. This is due to the way we design, manufacture, and deliver our projects. A modular process requires full design resolution and documentation before any works can be undertaken, which allows us to plan exactly what we are building it, and exactly how much it will cost prior to manufacturing. This process also means we can work backwards from a budget to create a design guaranteed to fit a client’s constraints. Learn more about it in the video above.

Our designs can also be costed and approved – or frozen – before manufacturing begins, giving project managers much more certainty. There’s still flexibility with modular construction and any changes to the layout can be accommodated and costed accordingly throughout the project.

Not only that, but a modular construction project can also be completed up to 40-50% faster than a conventional project, due to most of the work being completed and approved off-site. The controlled, factory environment attracts more skilled subcontractors than convention worksites, mitigating the impact of trade shortages. All this combined helps ensure projects remain on track timewise, with greater manufacturing efficiencies taking place in a controlled factory environment, often running concurrently with site works.

This means clients, whether they’re councils or commercial developers, can also benefit from cost certainty, as well as faster ROI because the building can be occupied much sooner.

During uncertain times, modular can provide clients with price-certainty, reaffirming why we believe it is the best, most efficient way to build.

Read more about our residential pricing here.