Research on Incremental Cost Effectiveness of Prefabricated Housing from the Perspective of Reducing Loan Interest in the Construction Stage
Publication: ICCREM 2022
ABSTRACT
Compared with cast-in-suit buildings, prefabricated buildings have great advantages in production efficiency, shortened construction periods, resource conservation, and environmental protection. However, the high cost of prefabricated buildings hinders its development. Most of the funds for real estate companies are from bank loan. The loan interest is the important component part of real estate development cost. Shorter construction period and earlier advance selling can reduce loan cycles, thereby reducing loan interest. This paper studies on the incremental cost effectiveness of prefabricated housing from the perspective of real estate loan interest based on the construction duration and sales stage of real estate projects. Taking the real estate development project in Dongguan City, Guangdong Province, as an example, the research results show that the loan interest of prefabricated buildings can be reduced by about 40% more than that of cast-in-suit building. And the incremental benefits can offset partly the increased construction costs of prefabricated buildings. This paper not only offers some suggestions for lowering prefabricated housing costs, but also it may help to promote prefabricated housing.
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ICCREM 2022
Pages: 445 - 452
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Published online: Dec 15, 2022
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