The survey arm of insurance giant Legal & General believes it has the answer for bringing the mortgage market on board with prefab and modular home lending.

“An industry-wide guarantee would help bring everyone to the market but, of course, their appetites will differ according to the requirements of their own lending policies,” said a Legal & General spokesman.

“There are many ways of reassuring mortgage lenders that homes constructed offsite are reliable enough to lend on.”

“But not least is the need to establish an industry kite mark such as Build Offsite Property Assurance or the National House Building Council which offer independent assurance around the design life of the homes.”

Legal & General, which owns a modular housing factory capable of building 3,000 homes per year in Leeds, U.K., has been active in the manufactured, modular and prefab industries, including increasing its stake in builder Cavco Industries.

Speaking on the Farmer Report by Cast CEO Mark Farmer in November, which called out modular housing as a solution to the U.K. housing crisis, Paul Stanworth, managing partner at Legal & General, commented on the company’s plans.

“This review sets out a clear way for the construction sector to reinvent itself in order to meet the ever-growing demand for homes and infrastructure,” said Stanworth.

“Legal & General is helping to address this problem by investing in a modern factory to produce homes using manufacturing processes seen in the production of cars and other consumer goods.

This construction method is safe, clean, and fast, providing a high level of consistency and durability. We sincerely hope that Farmer’s review galvanizes the entire sector to invest in innovation and secure its future.”

According to Mortgage Introducer, Legal & General Surveying Services has been helping lenders understand risks and opportunities with visits to development sites that use modern methods of construction and by having speakers talk to property risk managers. It has also invited lenders to its factories.

“The government also supports offsite construction and hints that a soon to be published housing white paper may increase that support,” said the spokesman.

“The government will be keen to use these homes to fulfill the need in our cities as well as new towns. We see offsite construction as part of the wider solution to the housing crisis, and these buildings are particularly well suited to delivering affordable homes – the very kind of property we need most.”

While critics of prefab homes in the U.K. often negatively compare them to ones built after World War Two, Legal & General says that the modern construction is very different.

“Post-war, the key was to house people. Now the materials used must come with quality assessment so the properties can be mortgaged from the outset,” said the spokesman.

“Also the quality of build and the features and specifications available are light years away from previous incarnations. New techniques are likely to be higher quality than traditional techniques because they are precision engineered.

Much like the automotive industry, the technology and features available now are unrecognizable to the post-war period.”

For more on modular and prefab housing in the U.K., including China National Building Material Company (CNBM), Barcelona Housing Systems and U.K. housing association Your Housing Group (YHG) joining forces to build six prefab factories that will deliver 25,000 energy efficient homes per year, click here. ##

(Image credits are as shown above.)

Submitted by RC Williams to the Daily Business News for MHProNews.