California Aims to Boost Factory-Built Housing in 2026

Published on Feb. 22, 2026

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California state legislators, led by Assemblymember Buffy Wicks, are pushing to boost factory-built housing in 2026 through a package of new bills. The effort comes amid a national housing shortage, with policymakers hoping to harness the speed, efficiency, and cost-savings of assembly-line construction to address the crisis. While past attempts to industrialize home-building have failed, lawmakers believe the time may finally be right, with growing developer and investor interest in modular and prefabricated construction.

Why it matters

Factory-built housing has the potential to significantly reduce construction timelines and costs, which could make new homes more affordable. However, the industry has struggled to overcome high upfront costs, regulatory hurdles, and a lack of familiarity among builders, lenders, and code officials. California’s push aims to create a more supportive environment for off-site construction to take hold and become a regular part of the state’s housing production.

The details

Wicks has organized legislative hearings to gather information and build support for a package of bills that could include measures to: 1) Encourage or require affordable housing developers and public entities to consider factory-built options; 2) Provide insurance or other risk mitigation to protect factories and developers if projects are delayed or canceled; and 3) Standardize building code requirements to make it easier for factory-built units to be approved on-site. Supporters argue these types of policies could help address the chicken-and-egg problem that has plagued the industry, where factories struggle to stay in business without a steady pipeline of projects, while developers are hesitant to commit to factory-built construction due to the upfront costs and risks.

In late 2024, Wicks organized a series of meetings on permitting reform that led to nearly two dozen housing bills in 2025.Wicks and other lawmakers visited Sweden in the fall of 2025, where nearly half of residential construction takes place in factories.Wicks has scheduled two select committee hearings in early 2026 to gather information and build support for the upcoming legislative package.
The players

Buffy Wicks

An Oakland Democrat and one of the California legislature’s most influential policymakers on housing issues, leading the charge to boost factory-built housing.

Randall Thompson

Runs the prefabrication division of Nibbi Brothers General Contractors and has seen a growing number of ‘modular-curious’ clients in recent years.

Ryan Cassidy

Vice president of real estate development at Mutual Housing California, an affordable housing developer that has committed to building its next five projects with factory-built units.

Ben Metcalf

Director of the Terner Center for Housing Innovation at UC Berkeley, which is writing a white paper summarizing the information gathered in Wicks’ committee hearings.

Jan Lindenthal-Cox

Chief investment officer at the San Francisco Housing Accelerator Fund, which is providing short-term, low-cost loans to developers to cover the higher upfront costs of factory-built construction.

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What they’re saying

“Over the last eight to 10 years or so the Legislature and the governor have really taken a bulldozer to a lot of the bureaucratic hurdles when it comes to housing. But one of the issues that we haven’t fundamentally tackled is the cost of construction.”

— Buffy Wicks, Assemblymember (CalMatters)

“When you go to buy a car, you don’t get 6,000 parts shipped to your house and then someone comes and builds it for you.”

— Ryan Cassidy, Vice President of Real Estate Development (CalMatters)

“Factory-built housing has the potential to reduce hard (labor, material and equipment) costs by 10 to 25% — at least under the right conditions.”

— Ben Metcalf, Director, Terner Center for Housing Innovation (CalMatters)

What’s next

The Terner Center for Housing Innovation at UC Berkeley is writing a white paper summarizing the information gathered in Wicks’ committee hearings, which will be released in the coming weeks along with the legislative package of bills aimed at boosting factory-built housing in California.

The takeaway

California’s push to make 2026 the ‘Year of the Housing Factory’ represents the latest attempt to harness the potential of industrialized construction to address the state’s housing crisis. While past efforts have struggled, lawmakers believe the time may finally be right, with growing developer and investor interest, and a belief that the right policy supports could help the industry overcome longstanding barriers and become a regular part of the state’s housing production.