1. What building on site means for the budget
Three consequences.
| Consequence | Compared with prefabrication |
|---|---|
| Costs are spread more evenly through construction | with prefabrication much falls in an earlier stage |
| The labour share is larger | ties the price more strongly to wage levels |
| The material share is also significant | ties the price to movement in material prices |
The third row is particularly relevant in 2026, because on Statistics Estonia data the second quarter construction price index was driven most by rising material prices, with the index up 3.1 % year on year. Labour costs have risen faster than materials.
A solution built on site is therefore more exposed to current price movement than a prefabricated solution fixed early. That is not a defect but a risk profile, and it must be known before signing a contract.
2. Construction time and its effect
On commercial sources, block houses are completed in roughly 12 to 18 months. The period depends on the weather and on labour availability.
| Technology | Typical construction time |
|---|---|
| Timber frame | 8 to 14 months |
| Block construction | 12 to 18 months |
A longer construction period means longer exposure to price movement, unless the contract covers it. It also means a longer period of temporary accommodation, which is a real cost to the client although it does not appear in the construction budget.
Time must therefore be counted as part of the project cost, not only of the construction cost. Six months of additional construction means six months of rent or two moves, and that sum is often larger than the price per square metre difference between the two technologies.
3. Where the flexibility advantage lies
Two situations where building on site is clearly more useful. Both concern how far the design is settled.
Where solutions have not been finally decided and are to be refined during construction. On-site building allows later changes.
Where the shape of the building is complex and the prefabrication advantage disappears. Repetition is the main condition for factory production.
Flexibility is not free. Changes during construction cost money when building on site too, but they are possible. The difference is therefore not the price of flexibility but its existence: with a prefabricated solution some changes simply cannot be made, rather than being expensive to make.
4. What it requires
Three conditions. Continuous site based management, because the work is done on site over a longer period.
Allowing for weather, which in Estonian conditions affects the timing of works.
A clear agreement on how variations are priced, because flexibility means variations will occur. The agreement is made before work starts.
The third condition is the most often left unwritten, and it is precisely what destroys the flexibility advantage. A variation whose price has not been agreed is priced when the contractor is already on site and there is no competition.
5. What technology does not change
Two cost groups stay the same. Foundations and ground works, covered in the article on foundations and ground conditions.
Preparation and connections, which are independent of technology.
These two groups explain why the price ranges for the technologies overlap although the cost of the structure differs: the common part is large, and the differing part is smaller than it appears. The choice therefore does not turn on price alone.
In summary, and four practical rules
Building on site spreads costs more evenly, raises the labour and material shares, and is therefore more exposed to current price movement. Block houses are completed in 12 to 18 months against 8 to 14 for timber frame, and that difference is a real cost to the client through temporary accommodation. The flexibility advantage is the possibility of changes, not their cheapness.
Four rules: count construction time as a project cost, not only as a programme item. Fix how variations are priced if flexibility is to be used. Allow for sensitivity to material prices over a longer construction period. Do not compare technologies on price per square metre alone, because that leaves out the cost of time.
This article serves professional orientation at the date of checking. It is not a quotation.