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Housing is a mass customization market more than a mass production one. Most people don’t want to live in a modern Levittown. They want some space, but they don’t want the exact same set choices in their house as 1000+ other people have made.

In older areas it's also that the plots are not identical. The land cost is so high that it makes sense to spend extra on building customization to better utilize the land rather than plonk down a cookie cutter house that doesn't make good use of the views/sun/space/etc

I do not see why it “should” be more cost effective. Moving big, costly things requires big, costly equipment and expertise. And losses can be higher in the event of a failure.

Structural Integrated Panels (SIPs) and Insulated Concrete Forms (ICF) are two examples. SIPs are made from compressed foam with pressed wood on either side and are precut in the factory to fit together at the job site. ICFs are basically giant foam legos that you assemble together and then fill with concrete.