A Prefab Future: Turning Policy Promises into Scalable Housing Solutions
The Federal Government’s recent announcement of a $54 million investment into modular and prefabricated housing marks a long-overdue acknowledgement of the role prefabrication could play in addressing Australia’s escalating housing crisis. Yet, as the dust settles and a federal election is called a few days later, important questions remain. How will the funding be distributed across states and territories with vastly different infrastructure readiness? What portion will go towards manufacturing equipment, workforce training, supply chain development or certification? And most importantly, what measurable outcomes will this investment yield?
Mass Timber Townhoses, Jindabyne NSW, by Brother Nature. Structure and 24 completed bathrooms installed in 13 days. Photo by Guy Williment
Prefabrication is not new to Australia. For decades, it has existed in parallel to traditional building methods—frequently perceived as niche, often misunderstood, and too rarely championed at scale. But around the world, prefabricated and modular approaches have been deployed with remarkable success, enabling housing to be delivered faster, with fewer environmental impacts, and at consistent levels of quality.
As Australia sets its sights on 1.2 million new homes by 2029, the question is not whether prefab is viable—it’s whether we are serious enough to do what it takes to fully realise its potential.
To explore the implications of this investment, Prefab Projects rounded up leading experts across housing, prefabrication, and circular economy fields—gathering a range of insights on what this moment means, what challenges persist, and how Australia can turn this policy promise into lasting, scalable impact.
Scaling with Purpose: A Strategic Window for Modular Growth
The opportunity to bring modular and prefabricated construction to scale presents a pivotal moment in reshaping Australia’s housing landscape. Rob Stokes, Chair of Faith Housing Australia, points to the broad-reaching benefits of this approach—from shorter build times and improved quality assurance to reduced environmental impact and cost efficiency. Yet, as he notes, the effectiveness of the Federal Government’s $54 million investment will hinge on how strategically and transparently it is deployed. With targeted funding, this could be a foundational step toward industrialised housing delivery at scale.
The Federal Government’s investment in bringing modular and pre-fab manufacturing to scale could bring faster construction times, enhanced quality control, improved sustainability and lower costs
While exact details of how the $54 million will be spent are not yet clear – a targeted investment could make a big difference in bringing modular to scale
Rob Stokes / Chair of Faith Housing Australia
Lighting the Way Forward: A Pragmatic Shift in National Housing Delivery
In the face of Australia’s acute housing shortage, the Commonwealth’s investment signals more than just funding—it reflects a readiness to embrace new thinking and act decisively. For John Engeler, CEO Shelter NSW, Chair National Shelter, the support for Modern Methods of Construction (MMC) represents a practical, scalable solution to a deeply entrenched problem. He frames the government’s move not simply as policy progress, but as an act of leadership grounded in realism—one that prioritises speed, quality and productivity in housing delivery across the country.
the Commonwealth committing over 50 M to this, demonstrates a willingness to ‘light the way forward’ for doing whatever it takes to make a difference in how we can deliver much needed housing locally….We need more supply, of quality, cost effective and efficient housing delivered on the ground- literally- as soon as possible. ‘MMC’ – modernising the way we deliver a traditional product- will be a game changer in terms of productivity. The commonwealth directly supporting this shows leadership, policy awareness and good old fashioned pragmatic problem solving to a pressing problem- we need more houses as soon as possible…
John Engeler / CEO Shelter NSW, Chair National Shelter
From Prototype to Progress – Investing in Scalable, Sustainable Housing
Prefabrication holds the promise of delivering energy-efficient, sustainable and affordable homes at scale – but only if approached with long-term vision and strategic commitment. Adam Haddow, National President Elect of the Australian Institute of Architects, calls for a fundamental shift in how governments procure and partner with industry. Rather than defaulting to the lowest-cost tender, he advocates for investment in design-led thinking and construction infrastructure that enables meaningful transformation. The financial viability of prefabrication lies not in the first project, but in the cumulative benefit of the many to follow – a trajectory that requires shared responsibility, courage in policy, and an unwavering belief in the value of good design.
If we are to collectively realise the potential of prefabrication, particularly in the delivery of energy efficient, sustainable and affordable housing, governments at all levels need to commit to procurement models that recognise the need for investment in design thinking and construction infrastructure. To this end chasing the lowest procurement price won’t necessarily be the best strategy. Government needs to see themselves as partners in the process, where the cost of housing gets progressively cheaper over time. The first houses delivered will necessarily be expensive as private industry recoups investment in design thinking and delivery infrastructure requirements – it will be the 1000th house that will start to make financial sense – but we will never get the 1000th house without an investment in the first 999.
Adam Haddow / National President Elect Australian Institute of Architects
A Collective Momentum – Designing for a Future of Scaled Prefabrication
With a renewed focus on innovation and sustainability, recent funding announcements signal a critical shift in how we approach prefabrication in the built environment. As architects, this is a moment to harness design intelligence – to lead from first principles and shape built outcomes that prioritise quality, longevity and amenity. Yet, the $54 million allocation demands precision. As Elizabeth Carpenter, Managing Principal of fjcstudio and President of the AIA NSW Chapter, asserts, meaningful progress requires a coordinated and holistic response across the full spectrum of design, construction and delivery. Thoughtful, targeted investment – measured in tangible outcomes – will be essential in realising prefabrication’s potential at scale.
As architects and professionals working within the built environment, we are encouraged by the possibility of funding to assist with the development of prefabrication at scale. We are hopeful that this does mean a growing conversation is developing in a forward direction.
The allocation of the funding should be specifically targeted and be focused on providing innovative and sustainable solutions with measurable outcomes.
Improved amenity and quality providing longevity of building stock are key. This is how architects can assist by using our critical design thinking to navigate the complexities of prefabrication and tackle the issues from first principles. $54M will not go far, therefore it is important to understand the objectives and achieve measurable outcomes.
To realistically develop the possibility of prefabrication, the government must provide a co ordinated approach and look holistically across all aspects of design, delivery and construction. Again – our wheelhouse.
Elizabeth Carpenter / Managing Principal fjcstudio, Australian Institute of Architects NSW Chapter President
Building Toward Lasting Structural Change
The sentiment is echoed across the sector. Jan Lienemann, Managing Director of Zen Haus Group – Prefabricated Building Solutions, sees the announcement as a positive gesture—but one that must be followed by structural investment and strategic procurement. Piecemeal funding risks creating showcase projects without embedding lasting change. What is needed is a coordinated shift: industry development, planning reform, procurement strategies and long-term policy alignment across all levels of government.
The federal government’s $54 million investment in advanced manufacturing for housing, while a positive step, is ultimately insufficient to address the scale of Australia’s housing crisis. Prefabrication is a crucial part of achieving the ambitious goal of 1.2 million homes in the coming years, but $54 million barely scratches the surface in terms of the infrastructure, workforce development, and innovation required to make a meaningful impact.
To truly unlock the potential of prefab construction, we need a much larger commitment – both in funding and policy alignment – to embrace proven quality prefab systems from overseas, establish local manufacturing capacity, streamline approvals, and incentivise the use of prefabricated solutions across public and private projects. Without this, prefab risks being seen as a niche solution, when it should be front and centre in solving Australia’s housing supply issues efficiently and sustainably. Lastly, there has to be a customer centric approach. Quality control is key – not just for prefab but for all building methods. I just came back from a trip to Melbourne to visit a fast growing area and greenfield sites with small lots. The quality and workmanship of the homes I saw were extremely poor. Prefabrication can address a lot of the shortcomings especially with proven and strictly quality controlled prefab solutions like ours.
Jan Lienemann / MD at Zen Haus Group – Prefabricated Building Solutions
Unlocking Potential: Turning Recognition into Scalable Impact
The acknowledgement of prefabrication as a strategic solution to Australia’s housing crisis is a significant milestone—but its true value will depend on how effectively this recognition is translated into long-term structural change. For Annalise Knight, General Manager at Brother Nature – Mass Timber Design & Build, the opportunity lies not just in pilot programs or symbolic funding, but in embedding prefabrication within large-scale government projects and procurement strategies. Done right, this investment could catalyse a new era of industrialised construction—one defined by quality, speed, and sustainability.
It’s encouraging to see the government recognizing the role of prefabrication in solving Australia’s housing challenges. Prefabrication has the potential to deliver high-quality homes faster, more sustainably, and at scale—especially when backed by meaningful funding or integrated into government-scale projects. This investment is a step toward unlocking that potential, and I hope to see it support projects that demonstrate the full capabilities of industrialized construction. The key will be ensuring this momentum translates into lasting structural change rather than isolated initiatives
Annalise Knight / Brother Nature General Manager Mass Timber Design & Build
From Intent to Implementation: Bridging the Gap Between Policy and Delivery
For those working at the intersection of design, construction and policy, government support must go beyond announcements—it must translate into tangible action, clear allocation, and cross-departmental coordination. Nick Hewson Director and Founder of Arboralis, highlights the disconnect that often emerges between visionary policy statements and the realities of project delivery. Without a clear strategy, sufficient funding, and mandatory standards to support prefabrication, the risk is that this opportunity becomes yet another instance of innovation lost to inertia.
I welcome the announcement from the government about providing funding to support the adoption of more prefabricated buildings, but it is a relatively small amount for the scale of the industry and the challenges that need to be addressed. It’s not clear what the funding is actually targeted for and I would love to see more detail around how and where this is to be spent.
The support for a national certification scheme is a good start, but I would prefer to see this mandatory rather than voluntary to ensure that consumers are able to rely upon high quality buildings.
The government has a role to play in stimulating demand and generating pipeline for prefab. All levels of government need to demonstrate more joined up thinking, both between and within departments. Too often I see great ideas and initiatives at a senior level in one department, but by the time the actual delivery comes around it’s back to a business as usual process, and the innovation potential is lost
Nick Hewson / Director and Founder @ Arboralis | Chartered Structural Engineer
Funding Must Translate Into Actionable Design
Beyond policy and regulation, there is the matter of practical delivery. How does $54 million translate into physical outcomes?
At Systemised Design Group, Simon McCarthy (Director) believes that the sharing of funds between states should lead to the sharing of knowledge gained by that investment. Standardising design across government housing projects—so that prefab components are not bespoke to each site—will unlock scalability and cost-efficiency. Without that, isolated spending risks being consumed by overheads rather than outcomes.
$50M is a welcome investment, but if it is to be divided between the states, then shares will not even cover costs for additional manufacturing equipment and training.
I hope to see the recipients utilise the funding toward developing a catalogue of standardised, yet adaptable building designs for Government supplied housing, so the benefits can be repeated on many future sites. This would lead to responsible spending of tax payer dollars with increased accuracy in prediction of construction costs and programs.
Simon McCarthy / Principal Structural / DfMA Engineer at Systemised Design Group
From Talk to Transformation: Calling Out the Barriers to Real Change
While the government’s announcement has sparked cautious optimism, some within the industry argue that rhetoric continues to outpace reform. Jerry Tyrrell, Architect and Founder of Tools™, issues a candid critique of the current pace of progress—highlighting the minimal impact of existing efforts and the systemic inertia preventing meaningful change. He calls for the urgent removal of bureaucratic red tape, outdated industry practices, and fragmented certification pathways, advocating instead for unified approvals and proactive incentives that empower developers and manufacturers to scale Modern Methods of Construction (MMC). For Tyrrell, the time for conversation is over—the time for structural reform is now.
Architect & Founder of Tools™ thinks nothing significant is happening. Someone needs to call out the inaction / roadblocks / failure to deliver.
18,000 homes is less than 2% of the 1.2m needed to create inspired lives for tomorrow’s productive Aussies” says Jerry.
We keep talking instead of addressing the red tape & delay in accepting this good change. Streamline Certification into a single ‘whole of home’ product delivered by the AAC / AIBS / Councils. Bulldoze all the stupid obstacles such as dishonest, lazy Unions & work practices that need changing to accomodate production techniques using MMC products. And incentivise Developers to build these products. Profit can be kind and good for the community.
Jerry Tyrrell / Architect and Founder of Tools™
Certainty Through Certification: Creating a National Framework
As the modular and prefab industry edges toward broader adoption, one of the most critical enablers will be the introduction of a national certification framework. Without consistent standards, manufacturers face uncertainty around approvals, timelines, and compliance—obstacles that inhibit investment and scalability. Helen Kuo Principal at FK, emphasises that certification is not merely a bureaucratic box-tick but a foundational tool for unlocking growth across the entire offsite construction ecosystem.
The investment of the government to a national certification process is a critical step to the advancement of offsite construction. The uptake of MMC is dependent on the scalability of its supply chain and the manufacturers need assurance of a consistent national approach to the certification of their prefab products to sustain their output. Along with standardisation of regulatory approval processes, these are essential steps that will provide certainty of programme and broaden participation across the construction industry.
Helen Kuo / Principal at FK
Designing for Impact: Prefab’s Role in Regional and Mid-Rise Housing
For MGS Architects, the Federal Government’s $54 million commitment to prefab and modular construction is more than a policy shift—it’s a signal to invest deeper in the potential of offsite solutions. Director Joshua Wheeler sees this as a timely opportunity to focus on low- and mid-rise housing, particularly in regional areas where innovation, design quality, cost certainty and speed are most critical. With federal backing now aligning with industry momentum, MGS is poised to bring considered architectural thinking to scalable, high-impact housing outcomes.
MGS are excited by the opportunity to delve deeper into the prefab market now that the Federal Government has backed up their commitments with their recent $54M investment in advanced manufacturing of prefabricated and modular home construction. Our focus will be the low/mid-rise housing builds, especially the regional build programs to address innovation, design quality, budgets (and cost certainty) and speed of housing delivery.
Joshua Wheeler / Director at MGS Architects
Prefab Is Not a Panacea
While the potential of prefabrication is undeniable, some caution against placing too much weight on it as a standalone solution. Structural reform must accompany technological change. As Cameron Kaufman, Circular Economy Specialist at Coreo, points out, policy settings such as tax incentives and ineffective vacancy penalties continue to distort the housing market. A holistic housing strategy must ensure not just that homes are built—but that they are affordable, occupied, and serve public need.
Prefab can help build homes faster, but unless we address the structural factors that make housing so unaffordable—like tax incentives for landlords and the lack of effective vacancy penalties—it won’t solve the fundamental problem. Australia needs a housing strategy that doesn’t just produce more dwellings, but actually ensures they are lived in.
Cameron Kaufman / Circular Economy Specialist, Coreo
A National Opportunity for Transformation
What we are seeing is the beginning of a conversation—a moment in which prefabrication has been formally recognised as part of the solution. But to harness its full potential, this must become more than a line item in a federal budget. It must be part of a coherent, long-term transformation of the way we build, governed by smart design, measurable outcomes, and sustained government leadership.
Prefab is not merely a construction method; it is a national opportunity to rethink how we house, how we build, and how we futureproof the cities and communities of tomorrow.
What Comes Next
If Australia is to embrace that opportunity, this first step must lead swiftly to the next: from policy intent to delivery, from pilot funding to structural reform, and from fragmented innovation to a truly national strategy. Whether this is a turning point or another missed moment will depend entirely on how boldly we proceed from here.
As the national conversation around housing evolves, we’ll continue to spotlight the people, policies, and projects shaping the future of prefab in Australia. To learn more about our mission, meet the community behind Prefab Projects, or explore innovative projects near you, visit our About Us, Contact, or project submissions page.
