China-made homes assembled in Melbourne in a first for the city

Developer Kincaid’s Melbourne townhouse development is being built from modules created in China.

Melbourne homes almost entirely made in China are being built in the city’s north in what is believed to be a first for the city.

A series of five townhouses are being put together in Craigieburn from prefabricated modules made in an environmentally-controlled factory in Wuxi west of Shanghai.

The builds are being completed by Melbourne developer Kincaid alongside national housing giant Stockland and China-based, but Melbourne founded, prefabricated housing materials firm Signex.

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Kincaid chief executive Kris Burt said while they had initially shipped in parts for five homes, the factory behind it was offering to fill orders into the hundreds.

“We really want to get as much of it done in China as we can, these ones will be 75-80 per cent … we will try to get it up to 85 per cent,” Mr Burt said.

With the homes able to be built in the vicinity of 10 months faster than they would be normally, he said there were savings of tens of thousands of dollars on reduced construction timelines — and that in a competitive market, developers using the factory-led approach would be passing most of that on to buyers.

Developer Kincaid’s Melbourne townhouse development has just finished having a crane lift pieces into place.

The four-bedroom, three-bathroom townhouses each come with two living areas, a double garage (also prefabricated in China), to an eight-star energy efficiency standard under the Nationwide House Energy Rating Scheme and sold for $699,000-$749,000.

Noting that he believed it was a first for Melbourne, particularly at this level and for a townhouse project that could be scaled up easily to far more homes, Mr Burt said the approach had rapidly won over buyers with investors buying all five in three weeks — despite them not yet being built.

The homes are currently waiting for their kitchens to be installed and expected to reach occupancy stage by Christmas, despite the slab only being poured in early November.

A crane on site has placed everything from floors to fully formed external and interior walls, bathroom “pods” that were effectively plugged into place complete with a shower, toilet and waterproofing already completed, and even most of the interior roof spaces.

Modules being moved from shipping to the build site.

The only locally made aspects are the kitchens and the Colorbond roof exterior.

Kincaid chief operating officer Joel Martin said it was “like a jigsaw puzzle”, with prefabricated walls already having external rendering, studs, insulation, plastering and electrical wiring.

The modules are checked for Australian standards on site before being put on a boat, and again when they arrive at the site.

Mr Martin added that they had informed prospective buyers that the homes would be manufactured as modules offshore, and “were worried about how the market would perceive that”.

“But we sold it out in three weeks, and that shows the market is OK with it being made in China,” he said.

He said that in terms of the actual construction, the major difference between the homes and a traditional build were that these were flat packed.

Both he and Mr Burt said the modular homes, which currently have a display suite run by Signex in Tarneit, felt more solid than traditionally built homes and that had appealed to buyers. Signex is founded by Melbourne-based Jeff Xu, who also runs developer Golden Age.

One of the prefabricated segments being lifted into place.

Mr Burt said if the nation wanted to hit its National Housing Accord target of 1.2 million homes being built by 2029, this sort of modular building would need to become more common.

While he would love to work with Australian manufacturing in the space, he didn’t “know how far away we are from that”.

Urban Development Institute of Victoria executive director Linda Allison said while she had heard of modules for homes being shipped in from China “a bit”, she’d not encountered it to the extent of the Kincaid project.

“There’s discussions about it, but there’s a tension between that and trying to stand up an industry in Australia,” Ms Allison said.

Workers preparing the local assembly of the factory-made components.

In both instances, she said the industry was “fledgling” and it was likely things would change as greater regulatory change and advancements were made in the space.

“But I think we will see more of this,” Ms Allison said.

“Developers are trying to innovate and cut down on costs all the time.

“At the moment, most of the industry, whether they have run the number it’s just perception, they don’t see the savings as significant at this point.”

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