This Startup Wants to Fix the Housing Market - with Robots (msn.com) 78
In a state where housing is expensive to build, to rent, or to buy — and not especially energy efficient — can a big blue robot make a difference?
The Boston Globe reports on Reframe Systems, one of the companies "trying robots to make construction more efficient" — in this case, "working alongside humans in an assembly line to build small houses in a factory." [Its cofounders] learned to get robots and humans to work together while at Amazon, which has built more than 750,000 bots in Massachusetts and deployed them to distribution centers around the world. Advising the company are Amy Villeneuve, former chief operating officer of that Amazon division, and Charly Mwangi, a veteran of the carmakers Nissan, Tesla, and Rivian...
Standing at one end of Reframe's factory, [cofounder Aaron] Small explained that the company's ambition is to build net-zero houses — houses that produce as much energy as they use — "twice as fast as traditional methods, twice as cheap, and with 10 times lower carbon" emissions. That means using large screws called helical piles to fix the house to the site, instead of a concrete foundation. (Concrete production generates large amounts of carbon dioxide.) The company buys recycled cellulose insulation to fill the walls. Solar panels go on the roof and triple-paned windows in the walls...
Reframe's "microfactory" can produce between 30 and 50 homes a year, [cofunder Vikas] Enti said. Eventually, the company aims to set up larger factories around the country, all within an hour's drive of big cities.
After a home is trucked to its final destination, "Electrical wires and plumbing are installed in both floors and walls as they're built," according to the article.
"Employees toting iPads can refer to digital construction drawings and get step-by-step instructions about tasks from cutting lumber to connecting pipes." One of the co-founders says, "We like to compare it to Lego instructions."
The Boston Globe reports on Reframe Systems, one of the companies "trying robots to make construction more efficient" — in this case, "working alongside humans in an assembly line to build small houses in a factory." [Its cofounders] learned to get robots and humans to work together while at Amazon, which has built more than 750,000 bots in Massachusetts and deployed them to distribution centers around the world. Advising the company are Amy Villeneuve, former chief operating officer of that Amazon division, and Charly Mwangi, a veteran of the carmakers Nissan, Tesla, and Rivian...
Standing at one end of Reframe's factory, [cofounder Aaron] Small explained that the company's ambition is to build net-zero houses — houses that produce as much energy as they use — "twice as fast as traditional methods, twice as cheap, and with 10 times lower carbon" emissions. That means using large screws called helical piles to fix the house to the site, instead of a concrete foundation. (Concrete production generates large amounts of carbon dioxide.) The company buys recycled cellulose insulation to fill the walls. Solar panels go on the roof and triple-paned windows in the walls...
Reframe's "microfactory" can produce between 30 and 50 homes a year, [cofunder Vikas] Enti said. Eventually, the company aims to set up larger factories around the country, all within an hour's drive of big cities.
After a home is trucked to its final destination, "Electrical wires and plumbing are installed in both floors and walls as they're built," according to the article.
"Employees toting iPads can refer to digital construction drawings and get step-by-step instructions about tasks from cutting lumber to connecting pipes." One of the co-founders says, "We like to compare it to Lego instructions."
First they take our jobs (Score:2)
First ask the question... (Score:5, Insightful)
Over here, construction, including materials, is about 10% of the final price. ~50% is the price of the land.
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So what's the other 40% of house prices where you live?
My annual real estate tax assessment shows about 50% of the assessment in land price, and the rest is the house. Depending on tear-down costs, replacing the structure (say, in case of a fire) would likely cost significantly more than the assessed value. I haven't looked closely at land prices, but that part of my assessment is probably fairly close to market value.
Re:First ask the question... (Score:4, Informative)
Gross Profit.
Remember that tear-down and rebuild also includes profit. Nothing is sold "at cost" unless it's for inventory clear-out or other disposition.
Note I said "gross profit" not net, because if you're a homebuilder, you have to use that profit from a house to pay salaries etc. If you pay yourself say $30k per house built assuming you build 3 houses per year, you might price the house so you make $45k per house, so that if your demand changes, you have a delay, a spike in input costs, you can still pay yourself $90k/year on average.
And this isn't even "greedy profit seeking" this is just "making sure you have a going concern." I wish more people actually tried to run a business... they would quickly see that selling things "at cost" means you go out of business rapidly.
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Does anyone actually do that? It seems like every housebuilder simply builds as cheaply as is legal, and sell as high as the market will bare. If the market isn't delivering the yields they want, they sit on the land until prices go up.
Isn't that the normal way things are priced? At the point which maximizes profit, which in a supply constrained market is what the wealthiest in it can just barely afford/make a profit renting out?
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The real question to ask is "how much will these savings reduce the price of the home when it sells?"
Given how most contractors have operated in recent years, I'll bet you that answer is "Reduce? Hell, we'll charge extra for the privilege of owning these unique homes! Why the hell would be lower the price?"
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This is basic economics.
The value of a thing is what a valid buyer is willing to pay for it.
Sometimes that means a big win for the seller. Other times it means a big loss.
There is no reason for the sales price to have anything to do with the cost of acquiring/manufacturing to the seller.
Re: First ask the question... (Score:2)
Unless it's a highly competitive market, which this wouldn't be at least at first.
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Yes I had considered that in my reply but then decided to not address it because that's just an input value into the value of the for-sale thing to the buyer.
If it's a unique item that everyone wants then price goes up. If it is as common as dirt then the value to buyer is zero (or close enough).
No matter the details of the circumstances it always comes down to value = the price someone is willing to pay.
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that's just an input value into the value of the for-sale thing to the buyer.
Not necessarily. A perfectly rational buyer (stay with me here!) wouldn't care at all how many competitors there are in the market, just what they're getting for their money. There are situations such as luxury goods where that does come into play (you can't get a Luis Vuitton bag from anyone but LV so it's "worth" more just because of that), but often the buyer doesn't care and may not even know about the level of competition.
No matter the details of the circumstances it always comes down to value = the price someone is willing to pay.
Again, not always. There could be goods where people would be willing to pay m
Re: First ask the question... (Score:2)
Except that the article is supposed to be about âoefixing the housing marketâ. Sure, if you want to throw affordable housing out as a requirement, then sure, be as cold and profit driven as you like.
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That's the entire point. You can't fix it. It's a market. You can only increase the supply or reduce the demand.
Supply is a slow process as the difficulty is based on getting permits and utilities installed in a new area not on how long it takes to build a house.
Demand is unfixable unless you want to kill off a bunch of people.
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According to the article, they're focused right now on ADUs, or "Accessory Dwelling Units". That's corporate-speak for smaller units as 2nd dwellings on existing lots. Think "in-law suite". So cost of land would be close to zero as it is already a sunk cost. In reality the tax assessment would rise as the value of the property goes up, but that'd depend on the details of State law on propery tax increase limits, etc.
And a housing bill making its way through the Massachusetts Legislature could create a new market overnight for the company by making it much easier to plant so-called accessory dwelling units (ADUs) of up to 900 square feet in the backyard of any single-family home in the state.
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Not quite so in Europe. Land is (surprisingly) affordable if you don't want to live within 30 minutes of city centers. But building the house costs a fortune.
It's less the labor, though, it's mostly the ridiculous regulations and requirements to get everything approved. You have to waste a ton of money on stuff you don't need or want just because some regulation says you have to have it.
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Re: First ask the question... (Score:1)
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...what percentage of the final price of a house is construction? Then how much of that percentage will be saved by using robots vs. other more efficient construction methods, e.g. prefabricated sections/parts of houses?
Over here, construction, including materials, is about 10% of the final price. ~50% is the price of the land.
Pre-fab construction has been tried before and failed as it never lives up to promises or in many places, basic building codes... and that is in places where you have timber framed, badly insulated, cladded houses that last maybe 20 years. Over here where you need brick and mortar construction that's expected to last the better part of a century or more it's a complete non-starter.
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Potential solution if you have wood... (Score:4, Informative)
Some parts of the world pine is not as plentiful as North America and other building materials are used in preference such as bricks.
There is a robot for laying bricks:
https://www.fbr.com.au/view/ha... [fbr.com.au]
Looks slow to me. (Score:2)
Re: Looks slow to me. (Score:3)
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In earthquake zones like California at least building homes with wood makes more sense than brick. During an earthquake wood bends allowing the structure to sway a bit while brick holds rigid and breaks.
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A big hunk of concrete has to be designed for some flexing; there is no use case where it won't get some amount of unbalanced stress. Bricks are small enough to not need to flex, but mortar isn't designed to handle quake shocks, and once it crumbles there's no strength left to the wall.
There's a reason that brick buildings are almost unheard of in Tokyo (the only one I saw was a train station that's kept that way for historic reasons)
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https://science.howstuffworks.... [howstuffworks.com].
Brick and concrete buildings have low ductility and therefore absorb very little energy. This makes them especially vulnerable in even minor earthquakes.
I can confirm I'm not an engineer but at least I make sure I know how things work before I talk about them. If you're one I hope I never have to use anything you're responsible for.
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I don't know why we build houses with sticks in the USA. The 3 little pig story holds true.
Sure, a brick/stone structure with steel is more durable, but at a significantly larger price. A wooden structure is "good enough" in most places for the cost, especially if you want something more complex (large open areas), which is what most of us like. If you want only 4 to 6 walls, as found in the 3rd world countries I've visited, then yes, go build a 3mx4m cinder block house with a tin roof. Of course, there are a lot of examples in the middle. For example, if your environment is very dry, check out "
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Not seeing the disruption here... (Score:5, Informative)
There is absolutely no reason for houses today to be energy inefficient. This question is completely orthogonal to the question of pre-fab housing and automation.
Pre-fab housing is nothing new, so it's hard to see this as a disruption. Where we live, there are a number of companies that pre-assemble house components in their shop, and deliver them on-site. Varying degrees of automation. There machines aren't blue, though, so perhaps that's the innovation?
The advantage of pre-fab is that the building process is a lot more controlled and efficient than hand-assembling on-site. The individual walls and other components are then delivered to the site, where final assembly takes place in just a day or two.
Note that pre-fab houses can still be custom-designed. It sounds like this company doesn't know how to do that; they are putting together a fixed design to sell. That's fine for low-budget housing, but isn't going to satisfy most people's needs.
Re:Not seeing the disruption here... (Score:4, Insightful)
It sounds like this company doesn't know how to do that; they are putting together a fixed design to sell. That's fine for low-budget housing, but isn't going to satisfy most people's needs.
Low-budget housing is what most people need.
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Those who need a 2BR, no options house are unlikely to be in a financial position to have a house built at all. Also, they still need a place to build it, and land in the Boston area is notoriously expensive.
Also, TFA ties this to a regulation change, allowing people to put very small houses in their back yards. That sounds like something you might add to your existing house for aging parents or young-adult children, to give them and you some privacy. It's not going to have a major impact on the housing m
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It needs to be good housing though. Not microscopic so they have to move when they have kids, or have to rely on self storage and meeting friends outside because they don't have the space at home.
The situation is really bad in the UK, where many new homes are below the minimum size for human habitation, and even all the fitments have been downsized so you have to squat on a little child size toilet etc.
The real issue is not the cost of actually building houses, it's the cost of land and buy-to-let. Building
Re:Not seeing the disruption here... (Score:4, Interesting)
Amish (Score:2)
So they're going to replace Amish people with robots to build trailers.
Helical scam. (Score:1)
Helical piles are long (tens of feet long) screws that attach a structure to the ground. They work in some ground but not in harder ground (caliche) or softer ground. In other words, they can work about 20-33% of the time. The rest of the time they are unable to adequately anchor a bulding to the ground.
They lack a foundation. This also means the lack of a solid plumb and level surface. While that seams cheaper, there still needs to be a reference surface which IS plumb and level, so there we go adding
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Ignoring the helical part, what's exactly the problem with getting pier and beam level? Just shim it.
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There's a scammer born every minute.
Construction cost is not the problem (Score:5, Informative)
Re:Construction cost is not the problem (Score:4, Interesting)
This exactly. Hasn't it struck anyone as odd that living on a cruise ship can cost less than living in an apartment?
Wrong focus (Score:5, Informative)
Today, I can buy prefab house kits from Amazon for about $20,000, as older generations could from Sears catalog, and build our own.
However, the next question is: where?
The previous generations could easily buy a land on the outskirts of the city (or even use "homesteading" to get it for free), cut down ancient forests, and build their own home. Not saying we should do that anymore, but even if you find a piece of land completely barren, it would take 10 years to get a permit in California, along with unending streams of CEQA lawsuits from unrelated parties. Basically any "new" construction is out of the question, at least for middle class.
That leaves you with existing permitted land. The problem:
https://www.latimes.com/califo... [latimes.com]
The charred remains of a burnt down house costs $1,000,000
So my brave new home project cost goes from $20,000 by a measly 5,000% to $1,020,000
As long as we don't fix permitting, there is no reason to worry about construction costs.
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It's more than just land. If the land had not been previously developed then you need the city or county to build roads, power lines, water lines in both directions, as well as making sure you're covered by emergency services, mail, and so on.
You can't just slap a house down on some dirt and call it a day. This isn't the 18th cebtury.
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Rather than just fixing permitting, the government should be looking to create new estates and towns. Pre-permit all the land for any building that meets certain criteria, put in the infrastructure, and let individuals buy lots at cost to build their homes on. Some commercial building will be needed too.
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You are right that the biggest innovation needed is legislative. But it won't happen. For one thing, most people already own a home .. what inventive do they have to allow new homes to come up when it will be (perceived) at the detriment of their own house value? "If someone can have a house for $20K why would they pay $1,000,000 for mine?"
The only fix is cultural, we have to realize that homelessness and high rents is bad for people. We have to realize that it is morally wrong to legislatively prevent new
Re: Wrong focus (Score:1)
I have noticed that every time the price of housing goes down, there is fear and panic in the news. We are wedded to the idea that the home is an investment and its price shall only go up, and that if the price does not go up, something is very wrong:
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Yes. I've build two houses in the last 6 years.
One was a 900SF ADU that I rent out. Construction cost of what I wanted to build was about 250K. I put another 200K into engineering (required by city) and 400K into site and environmental (required by city).
Second project 4000SF infill house that I'll sell. Construction cost of what I wnated to build 900K. Other construction required by city 500K) another 400k paying required engineers (required by city).
PS, each permit took 2.5 years from the time that I
Building is easy; Getting permission is hard (Score:4, Interesting)
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We do have those now, actually, but mostly they're just being used to spread spam, propaganda, and malware instead.
Stupid solution, move jobs elsewhere (Score:2)
The real problem is over-crowding. Everyone is forced to live in the same place, which is driving land prices up and up. Instead force jobs to move elsewhere, that will bring down the demand for the same piece of land.
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The real problem is over-crowding. Everyone is forced to live in the same place, which is driving land prices up and up. Instead force jobs to move elsewhere, that will bring down the demand for the same piece of land.
No one is forced to live in expensive areas. Those areas are expensive because of the sheer number of people that WANT to live there. They could, in most cases, live and work in cheaper areas, and have a nice house and job. But New York is New York Expensive because legions of twentysomethings have a romantic itch to live that "New York Experience", and so the city is constantly stuffed with people trying to get in.
Everyone can't have a pony. And everyone can't live in the most expensive areas.
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Affordable? (Score:4, Informative)
From the article:
This 900-square-foot home will cost roughly $300,000 - about $100,000 less than a similar custom-built home...
It will rent for $2,000 a month.
I understand that this is a Proof of Concept, but I have to wonder if anyone involved has an idea as to what "affordable" means.
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From the article:
This 900-square-foot home will cost roughly $300,000 - about $100,000 less than a similar custom-built home...
It will rent for $2,000 a month.
I understand that this is a Proof of Concept, but I have to wonder if anyone involved has an idea as to what "affordable" means.
There's no way in hell that over a quarter-million bucks for a pre-fab home is reasonable. This experiment is gonna fall on its face.
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You haven't been keeping track of housing prices.
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house share (Score:2)
When I was in my 20s, being homeless would have meant I was unable to find 4 or 5 other people to share a house with through ads in the paper.
Throughout my life there have rarely been fewer than 4 people living under the one roof
Now homelessness seems to mean being unable to find a house to yourself
Zoning might block that (Score:2)
That is a dead-standard (Score:2)
They want to skip the foundation, and use paper pulp as the insulation? What could possibly go wrong? Except pretty much everything. Besides, this is hardly new - it’s basically the asian-style of house building. When you build
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No costs saved- think like a VC (Score:2)
No matter what it cost the company to build a house, they're thinking is they can strip out lots of labor, yet charge the same price claiming some "value add" bullshit. Who wins? They do. Another "disruption" with few
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Laying off More People is Not The Answer (Score:2)
Las Vegas (Score:2)
I'm sure I read somewhere that Las Vegas was basically created from nothing using what was considered to be worthless desert
I would have thought in a place a huge as the US, that a completely new city could be born. Maybe it's time to move the US federal capital to some new location custom built for the purpose
That way there would be guaranteed need for vast swaths of new housing to be built, ripe for automation and no existing residents to complain about it or historic districts to worry about trenching th
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Make sure it has a water source that's not already encumbered.
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Is it called Levittown? (Score:2)
For those of you who haven't been paying attention, cookie-cutter, assembly line houses are the norm. Drive into any new housing development and they all look the same crammed onto the smallest piece of land possible. That's what you get from mass-production. It's not a new idea. All this is doing is reducing the production cost. Meanwhile, the affluent will be building custom or at the very least semi-custom homes.
The tool that makes depopulation possible (Score:2)
In San Jose, construction costs dominate (Score:2)
For dense market-rate multifamily housing the major development costs are roughly:
Material, labor, and other construction costs: 69%
Financing: 9%
Water, sewer, transportation, parkland, etc. impact fees: 5-10%
Profit: 6.5%
These numbers come from the San Jose residential construction feasibility study, which is updated every October. You can find a summary of the 2023 one here: https://sanjose.legistar.com/View.ashx?M=F&ID=12388874&GUID=B352980F-6030-4E2C-B917-37DDD625A6CC
The bottom line is that *even
Stupid (Score:2)
Building a quality home is not a technical challenge. The most expensive and difficult part of building a home has nothing to do with the home itself. Lot grading, permitting, connecting to electrical utilities, septic installation or sewer connections, water connection or well digging, the finally footing and foundation digging and pouring are the parts of homebuilding that make things unapproachable for most people. If you are going to make robots, make them do that work.
Can’t fathom investor psche (Score:2)
How the hell did Lego instructions become an IPO for housing?
To investors, make money in housing owning the dirt, city, infrastructure and financing. Unless you buy the UBC code and burn it to the ground, there will never be profitable housing that is affordable
Theres nothing to fix (Score:2)
This only addresses constructions costs (Score:2)
And even then, it most certainly doesn't eliminate them.
The fact is you can't make housing more affordable when the land you are building it on isn't affordable! The price of land wont change. You might cut a bit off the top of construction. .
I actually think this would have little effect overall. People are paying to live where they can afford and prices reflect that. I don't believe they would go down much (or at all) if you make construction a bit cheaper -- people will still be willing to pay that
Forget it. (Score:2)
I'd like to live in the Voltron Blue Lion please. (Score:2)
Wall street Slum Lords (Score:2)
The Wall street slumlords have dramatically impacted housing prices. When one company alone owns over 80,000 houses, that is a huge issue.
This is worse than the era of company housing. I really regret selling my first house to one of these companies.
It's time for massive regulation and fees on these companies.