Prompt 3:
Construction & Design Innovation
Competition Prompt:
Reducing the Cost of a Home
Propose an innovative construction and design solution to reduce a home’s cost and demonstrate how your solution can be applied to a small home (accessory dwelling unit or “ADU,” starter home, micro unit).
Context:
Reducing the cost of a home and demonstrating how it can apply to a “small home”
Home prices in the U.S. have reached record highs, pushing affordable homeownership further out of reach for many, especially for first-time buyers or those seeking to downsize to smaller homes. Rising prices are influenced by land costs and construction costs, both of which have increased significantly in recent years due to inflation, material shortages, and labor shortages.
Innovation can combat rising prices from inflation, material shortages, and labor shortages. These cost savings come from innovative materials, new methods, different housing types (e.g., building a fourplex instead of a single family home), and efficiencies from new software or other technology. These innovations can have a significant impact on reducing the cost of building a home. These cost savings can and should be applied to small homes such as an accessory dwelling unit (ADU), starter home, or micro unit.
Why is construction and design innovation difficult to implement?
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Resistance to Change: Construction and design innovation is notoriously difficult to implement due to a combination of regulatory barriers, financial risk, and market hesitation.
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Fist-Mover Risk: Developers, municipalities, and funders often wait for someone else to take the first risk, leading to a lack of early adopters and limited proof-of-concept projects.
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Regulation: Local building codes and zoning regulations are frequently outdated and/or inflexible, making it challenging to approve or permit new materials, construction methods, or housing types.
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High Risk: Additionally, funders and lenders tend to be risk-averse, preferring familiar models with predictable returns over untested approaches.
The role of construction and design innovation in improving affordability
Historically, innovation in construction and design has played a key role in expanding access to homeownership. Programs like Sears Modern Homes made compact, ready-to-assemble houses available by mail in the early 20th century, lowering barriers for first-time buyers. After World War II, developments like Levittown used mass production techniques to rapidly build small, efficient homes for returning veterans. Over time, innovations such as engineered wood, panelized construction, and digital design tools like building information modeling (BIM) have helped streamline the building process, reduce waste, and lower costs. New housing typologies—like accessory dwelling units (ADUs) and micro-units—have also emerged as flexible, space-efficient options. These efforts, led by both public and private sectors, are central to meeting the demand for affordable small homes.
Solutions to inspire your brainstorming process
The organizations below have innovative financial solutions that support increased homeownership for middle-income or low-income homebuyers. In addition to speaking with our industry experts, these solutions may be a source of inspiration as you brainstorm your ideas.
1. Home Buyer Assistance Programs
Arrive Home (2025 Ivory Prize finalist) offers down payment assistance combined with innovative financing solutions like the Earned Equity Program, which allows borrowers with nontraditional credit histories or underwriting challenges to enter long-term purchase contracts that lead to homeownership. The program targets underserved populations who struggle to qualify for traditional Federal Housing Administration mortgages by using lease-purchase structures and alternative credit evaluations.
Compass Working Capital (2024 Ivory Prize finalist) manages the Family Self Sufficiency program, which helps participants in affordable housing save money over time by escrow accounts tied to increasing rent payments, supporting wealth accumulation and eventual homeownership.
2. Smaller Homes / Accessory Dwelling Unit (ADU) Financing
A previous Hack-A-House winner proposed an innovative financing solution for smaller homes or ADUs, offering lower-cost housing alternatives tailored to moderate-income buyers. Smaller homes or ADUs often have lower construction costs that improve affordability for first-time buyers.
3. Shared Equity Programs
Homes for the Future (2025 Ivory Prize winner) is an example of a shared equity model to increase homeownership for low-income buyers. In a shared equity purchase, buyers often contribute only a portion of the full down payment while a third party contributes the rest of the down payment in exchange for sharing in future appreciation of the home. While shared equity models can increase a buyer’s ability to afford a home, sharing their home’s equity with a third party decreases the buyer’s profits when they sell or refinance the home.
4. Credit Building for Renters
Both Esusu and Stake are innovative credit-building platforms that are aiding in homeownership by allowing renters to build credit through their on-time rental payments or cash-back rewards or financial incentives for paying rent on time. Together, these tools promote renter financial health, expand access to affordable credit, and lay the foundation for long-term goals like homeownership.
Other innovations include new approaches to underwriting, loan design, better condo or starter home financing products, down payment savings products, and shared risk models. And there are many more! You can consult our industry experts or ask the Ivory Innovations team for additional examples.
Creating a Compelling Pitch
To create a compelling and competitive pitch, your proposal should meet the following criteria:
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Innovative, Feasible, and Scalable
Your solution should push boundaries while remaining grounded in real-world feasibility. It should address housing challenges in a way that can be applied broadly—not just to one site or city. While case studies are encouraged to illustrate impact, your solution must clearly demonstrate its potential for scale.
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Clearly Address the Prompt
Show that you’ve done your homework. A strong pitch reflects a thoughtful analysis of the housing affordability challenges facing communities today.
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Financially Grounded
Solutions should not only be visionary but also economically viable. Highlight key financial drivers, cost assumptions, and potential funding sources. The more clearly your solution shows an understanding of market realities, the stronger your pitch will be.
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Clear Path to Implementation
Your pitch should answer the question: How would this solution go from pitch to reality? Outline specific, actionable first steps. Examples may include early partnerships, capital sources, or community engagement approaches.
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Time-Conscious Presentation Format
You will have 3 minutes to present your idea, followed by 1 minute for Q&A. Be clear, concise, and persuasive.
Getting Started
To develop a strong proposal, begin with the following steps:
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Choose the Right Prompt
Review the available prompts and select the one that most excites your group and aligns well with your team’s background, skills, and interests.
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Understand the Landscape
Investigate how this problem has been addressed in the past. Use the examples above as a starting point and explore additional case studies, organizations, policies, or innovations that relate to your chosen prompt.
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Brainstorm and Build
Think creatively. Generate new concepts or identify ways to improve on existing solutions. Focus on ideas that are both impactful and practical.
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Engage with Industry Experts
Attend sessions with industry professionals to refine your thinking. Use [this link] to view expert office hours and availability. Come prepared to share your idea and ask for constructive feedback.
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Iterate and Strengthen
Based on research and expert input, continue to refine and develop your proposal. A great idea becomes stronger through thoughtful revision and collaboration.
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Consult the Ivory Innovations Team
Reach out to the Ivory Innovations Team during the office hours (3:30pm to 8pm MT) to workshop your idea and receive early input on structure, feasibility, and presentation.
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(Optional) Use the Pitch Deck Template
You can use our suggested pitch deck format to guide your final presentation.
