Jeffrey Dowell and Barbara Poushinsky along with their dog Sarge at their prefabricated home in Rideau Ferry, Ont.Ashley Fraser/The Globe and Mail
Jeffrey Dowell and Barbara Poushinsky’s home in the rural community of Rideau Ferry, Ont., about an hour outside Ottawa, has a barn-style gable roof and chipper red siding. Inside, the high ceiling, large windows and open-concept layout in the kitchen-living room give the home a modern feel, while wooden pillars throughout the space add a rustic touch.
The 1,200-square-foot house is chic and homey, and kitted out with features that will help the retired couple age in place. You’d never know much of it was built in a factory and delivered to their property on the back of a truck.
Mr. Dowell and Ms. Poushinsky worked with a prefabricated home developer about four years ago when they were looking to build a home. They wanted it to be a place they could spend their golden years, and that would be as energy efficient as possible. Ms. Poushinsky says she was intrigued by the idea of a “flat-pack house,” and Mr. Dowell, a former auto industry worker, liked the quality-control process involved in a manufacturing setting.
“It came on a couple of trailers, and they’d made all the panels,” Ms. Poushinsky said. “They came on a Monday, and by Friday the house had windows and walls and doors and was fully insulated and sealed.” The roof was on early the next week.
Prefab homes such as Mr. Dowell and Ms. Poushinsky’s could be a major part of Canada’s housing market in the future, if federal government commitments come to fruition. Prime Minister Mark Carney campaigned on doubling the rate of residential construction over the next decade to reach 500,000 new homes per year, by creating a new entity called Build Canada Homes that will provide $25-billion in debt financing and $1-billion in equity financing to prefab home builders, and will place bulk orders of prefab homes.
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Renée LeBlanc Proctor, a spokesperson for Housing Minister Gregor Robertson, said in a statement that the government is committed to launching Build Canada Homes in the fall. “Minister Robertson has been engaging with a wide variety of partners to ensure success,” she said.
But whether Canadians want to live in them is an open question. For many, the term prefab housing conjures visions of cheaply built modular homes, boxy and boring cookie-cutter houses, or the all-function-no-form dorm buildings at industrial work sites. Housing policy experts and developers say an important part of scaling up the prefab industry will be proving to Canadians that today’s factory-built homes are high-quality and even beautiful.
“I think people, when they think of prefab, they think about little Quonset huts associated with mines or housing in the Far North,” said Carolyn Whitzman, senior housing researcher and adjunct professor at the University of Toronto’s School of Cities, who co-authored a report on prefab housing last year. But “there isn’t an aesthetic difference, or there doesn’t need to be, between prefab and on-site constructed homes.”
The 1,200-square-foot prefabricated house is chic and homey, and kitted out with features that will help the retired couple age in place.Ashley Fraser/The Globe and Mail
Prefab is an umbrella term covering everything from homes with some manufactured components – such as the panels that make up the physical structure – that are later assembled on-site, to volumetric modular builds where modules that can be as complete as having fully installed kitchens and bathrooms are ultimately fit together like Lego blocks, to traditional modular homes.
A June report by the Canada Mortgage and Housing Corp. said Canada would need to build between 430,000 and 480,000 new housing starts per year over the next decade to return housing affordability to 2019 levels. Getting to those levels depends on addressing the construction industry’s persistent low productivity, which experts say is driven by a combination of an aging and largely casually employed workforce and low technology adoption, among other factors.
The federal government is betting that prefab homes could combat that and boost supply. The Liberal Party said in its campaign platform that prefabricated and modular homes can slash construction times by up to 50 per cent, reduce costs by up to 20 per cent, and result in lower-emissions homes relative to traditional stick construction.
“The technologies of building housing have not really changed over time,” said Aled ab Iorwerth, deputy chief economist for the Canada Mortgage and Housing Corp.
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CMHC’s 2025 rental construction survey found about a fifth of rental developers are using some amount of prefabrication. While it doesn’t have data on the broader residential construction industry, Mr. ab Iorwerth said prefabrication appears to be underutilized.
“I’ve heard people say that even the architects of social and affordable housing do not try and take advantage of the standardization of parts,” he said. “I think the aspiration is getting economies of scale in some of these parts. It may look boring that the washrooms all look the same across different houses, but this is one way of getting costs down.”
Brandon Searle, innovation director at the University of New Brunswick’s Off-site Construction Research Centre, said prefab homes are not necessarily cheaper than stick-built, but they do offer “cost certainty” because the design details must be locked in ahead of time. However, they are “definitely faster” to build, he said, due to a combination of the automation benefits of a factory and not being at the whims of adverse weather.
They’re also often better-quality homes, Mr. Searle said. Researchers at the centre have also found prefab builds result in lower-waste and lower-emissions homes, even when factoring in transportation to the site, that tend to result in fewer worker injuries.
Prefab homes such as Mr. Dowell and Ms. Poushinsky’s could be a major part of Canada’s housing market in the future, if federal government commitments come to fruition.Ashley Fraser/The Globe and Mail
Jeremy Clarke, founder of Simple Life Homes, a developer of panelized single-family homes in Brighton, Ont., said that contrary to popular belief, most prefab allows for some customization. (The company manufactured Mr. Dowell and Ms. Poushinsky’s home.)
“Modular components are more susceptible to a rigid design program. Slide that scale down to what we do, panelized style, we’re less restricted but with that comes more soft costs and design time,” he said.
Still, he said ultra-customized designs are not the company’s preferred work. “There’s a cultural obsession with having our own unique homes. That’s a problem,” he said, adding later that “we could offer way more value using pre-designed or even CMHC-approved plans.”
Simple Life Homes has been able to assemble prefab homes on-site in less than a week, compared to roughly three months for an on-site construction of similar scope, said Mr. Clarke.
Stelumar Advanced Manufacturing Inc. – the recently announced prefab housing factory owned by Mattamy Asset Management – has estimated it could build about 3,000 housing units per year once its factory opens in 2026.
Stelumar is planning to start building six-storey condo buildings made up of volumetric modular units that will be 80 per cent finished – floors in, primer applied, cabinets hung and more – when they arrive on-site. The company will also make panelized walls and floors for low-rise developments such as single-family homes and townhouses.
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Peter Hass, Stelumar’s general manager, said the company believes it can save six weeks on the construction of panelized homes and knock the construction of condo buildings down to less than 10 months. In a market where buyers typically put down their deposit three or more years before they can get their keys, that could cut their waiting time in half at least.
“It makes a big difference, especially on the condo side. If you’re buying a one- or two-bedroom, your circumstances can change quickly,” he said.
But getting the prefab industry off the ground is no small feat. Builders need a certain amount of guaranteed and consistent demand to operate efficiently and profitably. Researchers from Italy have estimated developers need to have about 1,000 units per year in the works to achieve economies of scale.
Mike Moffatt, executive in residence at the Smart Prosperity Institute, an Ottawa think tank, said the variation in homebuilding regulations across municipalities poses a major hurdle to mass production. Factory-built homes also fall under two regulations, he noted: provincial building codes and manufacturing regulations. “It’s extra cost and extra time.”
In Sweden, similar government policy to what Mr. Carney is proposing quickly built one million homes across the country between 1965 and 1974. Today, more than 80 per cent of the country’s single-family home construction market is prefabricated.
The couple wanted the home to be a place they could spend their golden years, and that would be as energy efficient as possible.Ashley Fraser/The Globe and Mail
Canada itself has a rich history of prefab housing – a past to which Mr. Carney nodded nostalgically in his campaign ads. In the early 20th century, DIY house kits sold by Sears and Eaton’s were popular with Canadians. The end of the Second World War also spurred a massive prefab homebuilding effort that led to the proliferation of Canada’s now well-known “strawberry box” homes.
More recently, Prof. Whitzman pointed out, Canada has seen rapid scaling-up of supportive housing using prefabrication. Vancouver built 660 supportive housing units in 18 months, and Toronto completed 216 modular homes for supportive housing since 2020. Mr. Searle said prefab homes are common in Atlantic Canada and the region has a handful of mature developers.
Prof. Whitzman said student housing, senior’s housing and affordable rentals are three ideal scenarios for prefab housing.
Denser builds, such as condo buildings, lend themselves better to volumetric modular construction in particular, Mr. Hass of Stelumar said.
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Mr. Hass said his company’s condo buildings have been “designed for people to live in and be proud of.” They have a base design of 47 units of predominantly two- and three-bedroom condos; the smallest one-bedroom is composed of two modules and is 650 square feet, while the largest three-bedroom is three modules and more than 1,200 square feet. The kitchen of the largest three-bedroom has room to sit six people around a dining table, and a living room that can accommodate eight people. He said volumetric modular builds require doing the design work up front, which can improve layouts and maximize space.
When it comes to the façade, Mr. Hass said there’s lots of new technology on the volumetric modular side that allows buildings to look different from each other. “They can fit into the neighbourhood and look normal,” he said. “These aren’t just going to look like Soviet Union apartments.”
The only tell the building is factory-made? The thickness of the walls where two modules are fixed together.
In Rideau Falls, Mr. Dowell and Ms. Poushinsky said building prefab had another benefit. They wanted to build a passive house, not just for the environmental benefits but for certainty around their energy costs in retirement. The off-site construction method ensured the home would be airtight.
Now, having lived in the home for two winters, Mr. Dowell said it has delivered on their hopes: This past winter, they never spent more than $135 per month on energy – less than the average Ontario household. “It’s a really efficient, comfortable home,” he said.