Lego City

On niche modular housing models, what they say about the state of American housing, and where we can go from here.

If you bike four and a half miles west from the heart of Amsterdam, you’ll find yourself on Zeeburgeriland, a small, triangular strip of land just to the west of the city’s industrial docks. At first glance, there doesn’t seem to be much here other than some campsites and a yacht club, but if you turn towards the island’s center, you’ll find a small cluster of apartment buildings, surrounded by sports fields, recreational facilities, and bike paths. But these apartment buildings are not typical for a city like Amsterdam – they are not carved from pine or clad with bright red brick. Instead, these apartments, designed to house students, refugees, and other young people who struggle to afford housing in the city, are built from metal shipping containers, the same type that’s used to carry cargo into Amsterdam’s port. 

This project, called Startblok Zeeburg, is one of Amsterdam’s many shipping container communities, which help both refugees and young people by providing them with low-cost housing for a five year term. Startblok developments are democratically controlled – all residents are expected to play a role in managing their community, and tasks like cleaning common spaces, organizing weekly get-togethers, and welcoming new residents are split amongst the Startblok’s denizens. The development’s unique demographic blend of young Dutch residents and recently arrived refugees has been lauded by the World Habitat Awards and other non-governmental organizations for helping refugees integrate into Dutch society.

Amsterdam is not the only city that has turned to shipping containers as a solution to its local housing crisis – the mode has become popular globally, with projects popping up in Johannesburg, South Africa, Atlanta, Georgia, and Barcelona, Spain. Proponents of this new housing model often cite its flexibility, replicability, and low costs; since shipping container homes are pre-fabricated, modular construction methods, where a building is mostly manufactured in a factory and then transported to the building site, can be used. As a result, supporters argue that modular construction is quicker and less expensive than traditional, on-site construction, which can help cities both rapidly build new housing and facilitate affordability. 

Startblok Zeeburg, a complex of shipping container apartments in West Amsterdam

Modular construction advocates, including ever-controversial New York state representative and uncomfortably close ally to Mayor Eric Adams, Jenifer Rajkumar (D-Queens), have pushed for 3-D printed housing in New York City, claiming it will bring down construction costs and make housing more affordable. Rajkumar, who has called for drones and 3-D printers to “fly like swarms of bees constructing skyscrapers”, is the latest voice in a chorus proclaiming their allegiance to modular construction, hoping that the cheap construction costs will somehow conjure an endless stream of new housing.  In fact, she is so smitten with the model that she’s introduced yet another taskforce bill in the New York State Legislature (which, by the way, has exactly zero co-sponsors) to study the potential for 3D printed homes in New York State. Of course, her bill calls for developer giveaways, as her legislation pushes the task force to recommend “government inducements” to encourage the adaptation of this new housing model.

But should we join the choir of 3D printing devotees? Should we pray at the altar of shipping container construction? Does this construction model truly provide dignified, deeply affordable housing to all people?

Of course not.

Shipping containers have lots of structural challenges – building codes in most cities are not designed to support homes built from steel boxes, and the construction materials are prone to producing environmental toxins like mold and mildew. In Ealing, a middle-class district in London, dozens of formerly homeless families spent years in Meath Court, a hastily built apartment complex constructed from prefabricated shipping containers, where indoor temperatures regularly got up to 34 degrees Celsius (a whopping 93 degrees Fahrenheit). Children living in the complex developed heat rash from the brutal conditions, and the small size of shipping containers often meant that apartments were extremely cramped. Conditions regularly got so bad that the Ealing Council had to decommission Meath Court, controversially leaving tenants with just weeks to find a new home. In Brighton, another city in the south of the United Kingdom, residents living in shipping container homes constructed by the Brighton Housing had the inverse problem – their homes were too cold in the winter. 

Even shipping container projects like Startblok in Amsterdam, an initiative that has been received more warmly by residents than the developments in London and Brighton, have faced their own issues. In late 2023, a large fire broke out at Startblok Riekerhaven, Amsterdam’s landmark shipping container development, leaving 135 of the complex’s homes either completely destroyed or uninhabitable. Concerningly, it took firefighters nearly 5 hours to get the blaze fully under control, indicating that the city’s pre-fabricated homes may not be up to fire code. Sure, shipping container homes may be cheaper, but at what cost to residents themselves?

And 3-D printed homes aren’t without their own issues – in late 2023, an Iowa City construction firm had to tear down a partially-printed single family home due to major structural issues. Both vertical and horizontal cracks were found in the home’s concrete foundation, stoking fears that the completed building would not be safe for human habitation. And despite Assemblymember Jenifer Rajkumar’s strange diatribes about drones printing skyscrapers out of thin air, the reality of the situation is that few multifamily projects can utilize 3D printing, due to size limitations associated with the technology. Currently, 3D printers are better primed to replicate the dreary realities of suburban sprawl than the glistening skyscrapers that tower over Grand Central Station – and it’s unclear if better technology is coming anytime soon. 

Why, then, are people so quick to embrace niche modular construction models as a solution to the housing crisis if it hasn’t made housing more dignified? Obviously, not all modular construction models are as distinctly problematic as 3D printing or shipping container buildings, but the reason people have embraced modular construction seems simple to me. The real estate establishment wants to spend as little time, money, and resources as possible paying construction workers and housing our most vulnerable neighbors. 

For large real estate firms, cutting construction costs by skimping on workers’ salaries is attractive for several reasons – it reduces the power of the building trades while also maximizing their profit margins. Modular construction projects, like 3D printed homes and shipping container apartments, typically require fewer workers, and often offer lower wages, a major threat to construction unions that have spent decades winning livable, dignified wages for their members. And workers are already paying the price, as developers of Studio One Eleven, an affordable housing development built from shipping containers in Los Angeles, California, found that they were able to cut construction costs by a whopping 36%, mostly by reducing labor costs. Similar cost reductions, reaching up to 30%, are common in 3D printed housing projects, also due to low labor costs. 

It also shouldn’t be surprising that alternative modular construction models have become “solutions” to homelessness and housing instability – the private sector does not want to invest in high quality housing for these people because it does not make them a profit. Instead, modular construction companies seek out lucrative government contracts or other subsidies to ensure they still make money at the end of the day, while often failing to maintain minimum housing standards. And if you follow the money, real estate and financial capital are unsurprisingly pouring resources into these new cheapskate construction models. Large firms producing 3D printed homes such as ICON have raised nearly $200 million from venture capital firms, while billionaires like Warren Buffet have invested heavily in modular construction. 

At the same time, however, these models have also become lucrative solutions for cash-strapped municipalities who have little money to invest in new housing construction, as funding for the police consumes ever-larger slices of the urban budget pie. With many American cities unable to raise their own revenues without state permission, municipalities are forced to stretch their (often limited) housing budget further and further, making the shipping container house a cheap way to build as many units as possible.

Our homeless and inadequately housed neighbors deserve dignified housing, not poorly-tested homes built by drones and printers or boiling hot shipping containers that are vulnerable to mold. They deserve high-quality homes built by well-paid, union workers. And there are ways that we can produce lots of this housing at scale today, as long as governments are willing to value the basic need for housing over the profit margins of big banks and real estate magnates. 

At the federal level, the Faircloth Amendment could (and must) be repealed, which would allow municipalities to construct new public housing units at scale. Due to the size of the federal government’s budget (and the volume of military aid the United States sends to genocidal states like Israel), it is undeniable that America can afford to spend more on housing its population through the direct construction of publicly funded homes. Of course, for a new public housing program to be successful, more extensive long-term funding from the federal government and direct mechanisms for democratic, tenant control of public housing authorities will need to be integrated into HUD’s operations. New York City alone has $77 billion dollars in unmet capital needs across its expansive public housing portfolio – and a repeal of the Faircloth Amendment should be accompanied by federal funding to address this dire deficit. If fully funded, public housing has the ability to offer high-quality, deeply affordable, and dignified housing to its denizens, and must be a massive piece of our national “solution” to the housing crisis.

Bushwick Houses, a New York City Housing Authority (NYCHA) Public Housing Development

At a more local level, American states can follow the lead of New York State, who's recently proposed Social Housing Development Authority cuts back on development costs not by skimping on labor, but by eliminating unnecessary fees. Instead of relying on public-private partnerships or loans from profit-seeking lenders, the authority would invest public funds to create permanently affordable homes. Since private developers, banks and other private investors will only finance affordable housing projects that allow them to profit, lenders often charge high interest rates, while developers issue hefty developer fees that make affordable housing projects more expensive. A recent study by Hunter College graduate students (including myself) showed that eliminating developer fees alone could reduce overall development costs by around 10%, making SHDA housing more affordable for prospective residents. The authority would also have the power to issue interest rate subsidies, where loans for SHDA projects would receive more favorable interest rates than what would be available on the private market, reducing the total cost of the SHDA’s loans. Notably, the SHDA’s financial model accounts for a fully unionized workforce, proving that decommodified, dignified homes can be built by organized labor. 

The increasing popularity of niche modular construction models, like 3D printing and shipping container housing, within planning and political circles speaks volumes to the state of the American affordable housing market. Politicians like Jenifer Rajkumar and developers like Jason Ballard, the CEO of ICON, a modular housing company, can praise these construction models for their “innovative technologies” all they want, but these models are popular because they’re cheap, they cut labor costs, and they maximize developer profits. To cut development costs in a way that will benefit everyday people, we’re going to have to fight for it.