Feeling the Impact of Building Material Shortages? Try Modular Construction

If you’re looking for building materials and coming up short, you’re far from alone. The latest Commercial Construction Index from the U.S. Chamber of Commerce found that 46% of surveyed contractors said they were struggling with a building material shortage in Q2 of 2021 — up from 33% the previous quarter.

Making matters worse is the ongoing COVID-19 pandemic. Around 72% of construction contractors said the pandemic was causing project delays in Q2, and that’s in the face of increased demand for residential construction and skyrocketing home prices. The end result is frustrated home builders who can often do nothing but lay concrete foundations and wait until something changes to begin building. 

That’s the disheartening narrative for so many construction projects, but the building materials shortage of 2021 doesn’t have to be the end of the story. There is an alternative to traditional construction that may allow some builders to bypass the material shortage and get projects done: modular construction.

Anyone feeling the impact of the building material shortage may find a solution in the world of modular construction. In this post, we examine the material shortage problem and how modular may be the perfect solution. Read on to learn more.

Ready to embark on your modular construction journey? Don’t go it alone — work with the modular experts at VESTA Modular. 

The 2021 Building Material Shortage Problem

For those in the construction industry, the most generous way to describe the past several months is “problematic.” Fueled by an ongoing and deadly pandemic, disruptions in construction material supply chains have sent materials prices soaring and builders searching for materials and solutions. 

According to the National Association of Home Builders (NAHB), building material shortages in 2021 are more widespread than at any time since the NAHB started tracking this issue back in the 1990s. The NAHB’s May 2021 survey of builders across the U.S. found that more than 50% of builders were experiencing shortages with 21 of 24 listed construction materials. These materials included everything from lumber and steel to appliances and windows.

Comparing the survey conducted in May 2021 to the same survey conducted a year earlier illustrates the sharp rise in material shortages in a short period of time. For example, 9% of builders reported shortages of oriented strand board (OSB) in June of 2020, while 92% reported OSB shortages at the end of May 2021.

The following are some other building materials that saw a sharp rise in reported shortages over the past year:

• Plywood
• Framing lumber
• Copper wiring
• Trusses
• Gypsum wall board
• Vinyl siding
• HVAC equipment
• Steel
• Roofing materials
• Insulation

These are just a few of the building materials that have become much harder to come by in recent months. The building material shortage is impacting builders across the board.

Demand from Homebuyers Fuels Building Material Shortages

It’s not hard to imagine how the COVID-19 pandemic could have contributed to these shortages. The literal shutdown of factories and processing facilities for months on end was never going to have a positive effect on material availability. But pressure on material supplies is coming from directions other than the pandemic.

In particular, demand from homebuyers appears to be at least compounding the problem, if not directly contributing to it. The U.S. is experiencing a very real and very painful housing shortage. Right now, low interest rates and high lumber prices — as well as an apparent need to upgrade spaces for working from home — are driving consumers to seek out and snap up available homes, with many homes being bought just days after entering the market. 

It’s a basic problem of high demand and low supply. And those who can afford the newly expensive building materials it takes to build a new home will likely do so while aspiring homeowners will remain frustrated in the wings, waiting for the market to change in their favor (which it has not shown any real sign of doing).

Skilled Labor in Short Supply

Building materials and real estate aren’t the only things in short supply in 2021. More than 88% of construction contractors now report that they are experiencing moderate to severe difficulty finding skilled workers to fill open positions, according to the U.S. Chamber of Commerce’s recent report.

That shortage of workers is compounding the difficulty of actually getting a construction project done. Around 35% of contractors said they had turned down projects because they couldn’t find enough workers.

How Can Modular Construction Help with Building Material Shortages?

For many in the construction industry, the building material shortage of 2021 feels like an insurmountable problem. But it isn’t — not when modular construction is an option. Modular construction presents several solutions to the problems builders are currently facing. 

1. Modular Construction Can Use Different Materials

Short on lumber? Try shipping containers. That’s just one example of how modular construction can solve the building material shortage problem for builders. In modular construction, shipping containers are a common “module” that can be outfitted with everything a building needs and stacked and joined into an eye-catching structure.

However, even modular construction using traditional building materials can shelter projects from the high prices and lack of material availability. Why? Because modular building manufacturers can standardize the materials they use, measure them precisely and buy them in bulk far ahead of time. When the materials are available at an affordable price, a modular construction company can get ahold of them and hang onto them for future projects. Compare that to traditional construction, which often requires immediate supply purchases and custom materials.

2. Modular Is Fast

Skyrocketing building material costs — driven by lack of availability and high demand — have caused some construction projects to be abandoned mid-build. The jump in prices suddenly renders the project infeasible. Modular construction, on the other hand, solves this problem in part by being so fast. Getting the project done quickly leaves less room for material price jumps to sneak in and wreck the bottom line.

Here are a few ways modular construction speeds up the building process:

• Modules are constructed off-site while foundation and site preparation are completed instead of waiting for prep to be done before starting the build.
• Automation and standardized factory settings get the actual building done faster.
• Because very little of the modular construction process happens at the actual site, projects are not subject to weather delays.

3. Modular Requires Less Labor

Remember those skilled construction labor shortages we were talking about? They’ve done nothing but make the building material shortage problem even worse for both builders and their clients, but they’re hardly an issue in the world of modular construction. 

Here’s why: a lot of the labor is done by machines in a controlled factory setting. That means fewer people on the job site putting the structure together.

4. Modular Construction Is More Affordable

The speed of modular construction and the decrease in labor required come together to make modular construction more affordable than stick-built construction in most markets and scenarios. And when the cost of building materials is already driving up construction costs to previously unseen levels, every dollar counts.

Tired of Worrying About Building Material Shortages? 2021 Is the Year of Modular Construction

A lot has changed in the construction industry since the beginning of the COVID-19 pandemic. Unfortunately, many of these changes have had a negative impact on industry players. While the building material shortage shows no signs of letting up any time soon, there is an upside: the shortages and related factors are causing construction companies and those who want to build new homes and commercial buildings to consider an alternative to traditional construction.

Modular construction is that alternative. By using different materials and using them differently, increasing construction speed, reducing labor costs and being more affordable in general, modular construction has become the answer to the building materials shortage of 2021. That means 2021 should be the year of modular construction, and that sounds pretty exciting to the team at VESTA Modular.

Our team of modular construction experts is ready to take on the challenge of delivering modular buildings in a time when the construction industry is experiencing unprecedented difficulties. Interested in teaming up with us? Give us a call at (817) MODULAR or contact us online to start the conversation.