Offsite construction methods, including prefabrication, modularisation and industrialised renovation, offer a pathway to address Europe’s housing shortages while improving building performance. Factory‑produced elements shorten construction time, reduce labour and financing costs, and enhance envelope quality, thereby lowering operational energy use, such as heating and cooling demand.

The report also notes that offsite approaches can strengthen the thermal performance of buildings. Renovation with ventilated façade systems moderates heat transfer and reduces cooling loads by 20–65%, while improving acoustic conditions and indoor comfort. Offsite vertical extensions add new dwellings in dense urban areas without using additional land, helping France and Germany respond more quickly to housing demand.

At market level, offsite construction can lower residential housing prices by up to 30% in France and 22% in Germany, with further reductions for rooftop extensions. These gains translate into improved affordability, reduced housing cost overburden and earlier delivery of social housing units across the EU.

The study concludes that recognising offsite construction in the implementation of the Energy Performance of Buildings Directive (EPBD) and the Energy Efficiency Directive (EED), directing housing finance towards industrialised solutions, and adapting regulatory frameworks can accelerate the provision of affordable, low‑carbon homes while supporting reduced heating and cooling needs.