4 things you should know about prefabricated homes

Could prefab homes help more Australians turn their home ownership dreams into reality?

Industry experts met at SXSW Sydney to discuss whether prefabricated construction methods—where homes are built partially offsite in a factory and then transported and affixed to land—could help ease housing supply pressures. 

“Housing is the thing that people care most about right now,” says Georgina Harrisson, CEO of independent think tank, Amplify. “Australians are telling us they want the housing crisis solved; they want to see bigger, bolder action and they see that prefab could be part of that solution.”

Here are four things you should know about prefab homes.

1. Prefab homes can be built much faster

While the average house takes around a year to complete¹, prefabricated homes can be built in as little as eight weeks.

“It’s a faster build because it’s not impacted by weather … and there’s a lot of mechanisation and robotics,” says CommBank’s general manager of property and construction finance, Michael Bennett.

Although it’s not necessarily cheaper to use prefab construction methods, a shorter build time could come with cost-saving benefits. “It’s less time in a rental property, less time dislocated from your property, so there’s savings in that,” says Bennett.

2. Prefab methods can reduce waste

The factory setting and precise building approach used for prefab homes can result in less waste than a traditional build.

"Everything is made to order and is made in a much more controlled environment,” says Kunjan Ganatra, CEO of construction and development group, McNab. “There’s a huge benefit on waste and the social environment.”

And the standard of modern prefab homes is “right up there”, Ganatra adds. “I think it changes your perception really quickly.” 

3. You can fund the building of a prefab home with a construction loan

With traditional construction loans, funds are released in stages as your home is built as a fixed structure on your land. But CommBank is the first major bank to offer a construction loan for building prefab houses that allows access to funds during the offsite construction phase. “It’s been a journey for us on prefab,” says Bennett.

Customers building a prefab home with a CommBank Assessed Manufacturer for a fixed-price build contract of up to $1.5 million can access progress payments of up to 80 per cent of the contract price or 150 per cent of the land equity—whichever is lower—before the home is affixed to the land.

Those building with a non-assessed manufacturer can access up to 60 per cent of the contract price or 120 per cent of the land value, whichever is the lower amount.

4. Prefabricated homes may become more common

While prefab homes currently only make up around eight per cent of the construction market in Australia², they could become far more common in the future.

“We see, in other parts of the world, far greater take-up of this type of technology and way of building,” says Harrisson, with Amplify pointing to Sweden, Singapore, Japan and New Zealand as examples of countries adopting prefab construction³.

“We’ve done some modelling [at Amplify] that suggests that within 20 years, one in five new homes in Australia could be built using prefab and modern methods of construction.”

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Published: 11 November 2025