The Decentralization Of Home Building
Technology is allowing for things to be pushed further away from the center.
Over the last decade, we saw incredible progress in the ability to "build" homes in a manner that was not experienced before. Much of this credit goes to 3D printing.
We must bear in mind that things are still in the very early stages yet we are seeing a major dent made in the centralized structure.
One of the biggest advantages is the cost. Because it speeds up the process, the time needed to produce the "shell" is drastically reduced. We also see the ability to add more creativity.
Here is a video of an individual who "printed" a house in 48 hours.
The house was designed to be mobile in the sense that is floats, thus can be moved from one area to another. We also see a serious reduction in carbon emission.
Looking at the pictures, we can see how it is an interesting, albeit small, design.
This is not going to house a family of four. Nor is it something that the everyday individual is going to start making. However, we are seeing the ability to create projects such as this with a bit of technical expertise.
What makes this really exciting is that we are likely going to see the ability to generate something along this lines get easier as the technology progresses. This structure shows how far 3D printing has come in the last few years.
Across the 3D printing spectrum, costs are dropping rapidly as features expand. The materials being used for output has advanced to over 300. Here is where we see a great deal of flexibility.
One of the biggest advantages to centralization is the efficiency it provides. Decentralized systems tend to lag behind. The entire Industrial Revolution was based upon improving efficiencies of production. The assembly line, mass production, and specialization all helped productivity levels soar. It also established an environment where 5-10 companies are able to control any market.
Over the last few decades, residential construction moved into the "cookie cutter" realm. National home builders tend to offer a few basic models from which customers can choose from. Go through any housing development and you will see only a few different homes. Much of what is seen is just cosmetic when it comes to comparing one house to another.
This, of course, helped to increase profitability for those companies. It also helped to put many small home builders out of business since they simply could not compete. Those that remain are only able to stay in business by catering to the higher end, custom market where there is some profit margin.
Like many industries, many are watching to see if this trend will reverse itself. Technology helps to offset the lack of efficiency in decentralization. In this instance, the ability to print a home actually is more efficient than the commonly used method. We will see the major players follow suit.
Nevertheless, here is where we see the marginal cost pushed down. The ability to output a home is no longer based upon the particular company as much as the printer itself. Thus, it is entirely dependent upon the technology being used.
As prices drop, this makes it available to more players. This, by its nature, will help to decentralize the construction industry.
It is a trend we are seeing in food and energy as well as construction. None of these industries are to the point where the major players are being bumped off. That said, over the next 10-15 years, with technological progress, some will start to feel the effects of distributed production. Thus, we will see more produced locally for less money.
This could radically affect the home ownership market. What if the cost of building a house declines by 75% over the next 10 years? How would that affect those who got into a mortgage in the past year?
We are going to see a lot of changes and construction is a field that is ripe for disruption. We are going to see a lot of new entrants into the field, many with innovative ways of doing things.
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