Modular Housing Market Sounding

The Government of Ontario is working with municipalities and partners in the housing sector to build at least 1.5 million homes by 2031. To support this work, the government is conducting a market sounding exercise about modular construction to gather insights from industry stakeholders. The information gathered will inform decision-making on the best use of modular construction and other innovations as a means to increase and speed up home building in Ontario.

This exercise builds on earlier consultations led by the Ministry of Municipal Affairs and Housing and the Ministry of Economic Development, Job Creation and Trade, and stakeholder engagements led by Infrastructure Ontario and Invest Ontario to obtain critical information on the modular construction industry.

OBJECTIVE:

The objective of this market sounding exercise is to gather comprehensive insights into the pricing, timing/schedule, economies of scale, and regional dynamics associated with modular housing development. We are seeking your insight and expertise to inform government decisions regarding provincial action that supports modular housing development initiatives.

MODULAR DEFINITION AND ASSUMPTIONS:

It is expected that your responses focus on modular construction (i.e., manufacture, transportation, and assembly). To support the government in making comparisons between responses to this market sounding, please use the following definition of modular home and make the following assumptions:

• Definition of Modular Home:

A modular home is built using one or more prefabricated components or modules. It is constructed partially or completely off‐site, then transported to a property for assembly.

• Assumptions:

To help focus your responses on modular construction (i.e., manufacture, transportation, and assembly), please make the following assumptions in your responses to the questions below:

• Unit Size: 800+ square feet per finished living unit
• Type: Please specify in your responses the type of home(s) being produced, e.g.:
• Detached home
• Semi-detached home
• Multi-residential building

Please note if the unit includes basement (unfinished)

• Quality of finishes: Standard Finish
• Land: Available for development (i.e., do not estimate land costs as part of pricing)
• Services (e.g., utilities, roads): Ready for use (i.e., do not estimate costs for servicing as part of pricing)
• Regulatory environment: The relevant government is willing to collaborate with the industry for the development of modular housing projects. (i.e., do not estimate costs for approvals and permits as part of pricing

INFORMATION REQUESTED AND QUESTIONS:

The following are information and questions we seek your responses:

A. Company information:

Please briefly describe your company.​

• Location
• Years of operation
• Product produced:
  • method (e.g., panels, volumetric)
  • material (e.g., wood, cement steel); 
  • type (e.g., single detached home; semi-detached; townhouse; multi-residential low-rise/mid-rise)
• Existing customers/markets​
• Current/ planned production capacity​
• Level of vertical integration (e.g., both manufacturer and land developer, only manufacturer)​

B. Questions:

Pricing:

Per Unit Price:

• At what base price range per unit can you manufacture, transport, and assemble homes (i.e., the final unit price from manufacturing to building completion)?
• If more than one type of unit is produced, provide pricing for each unit separately.
• Please specify product details (e.g., method, material, type)

Economics of Scale:

• What is the minimum order volume required to start realizing reduced prices? What would be the estimated prices?
• Could larger orders volumes reduce the price per unit further? If so, what percentage of cost savings can be expected with increasing volume of modular units ordered?

Timing/Schedule

• How many 800+ sq ft units could be delivered (manufactured, transported and installed) within 12 months, 18 months, and 24 months?

Location:

• Do your prices typically vary by region (e.g., additional transportation costs for remote or rural areas - for example, Thunder Bay vs Windsor vs Toronto)?

Supply Chain:

• Can you describe any risks associated with your supply chain (e.g., locally-based supply chain vs. highly import-dependent supply chain; materials shortages)?

Regulatory Environment

• Are there any regulatory barriers (e.g., approvals, permits) or risks that could be addressed to promote modular home development?

C. Optional questions:

Production:

• Is your firm currently looking to expand its production capacity within the next 18 months? If so, what is your anticipated output?
• With a steady domestic demand, do you anticipate your costs will be reduced?

Consumer Demand

• What is your experience with the sale and marketing of modular construction units for home ownership (e.g., buyer perceptions, competitive pricing, consumer awareness)?

CONCLUSION:

We look forward to your valuable contributions to this market sounding exercise. Please submit your Market Sounding to modular@ontario.ca by June 7, 2024.

Please note:

This market sounding does not constitute a commitment by the Government of Ontario to procure any goods or services.

All information provided in response to this market sounding is subject to the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c.F.31, as amended (FIPPA). Information you provided may be released in accordance with FIPPA. In your responses, please identify any information for which confidentiality is to be maintained, the confidentiality of which will be maintained, except where FIPPA or an order of the Information and Privacy Commission or a court requires otherwise.

Please do not include any personal information in your response.