There’s a new factory in Austin, Texas, that is all industrial aesthetic—unfinished gray concrete with pipes veined across the walls—except for a large American flag hanging from above. An engineer operates machinery that cuts large sheets of reinforced steel down to size. Five engineers build dozens of panels—walls, floors, and roofs—along with complete kitchens and bathrooms. They are building houses, almost as easily as if they were cars on an assembly line.

The product, designed and manufactured by the American Housing Corporation, is a row house that can be packed into boxes, crammed into four shipping containers, and assembled on-site. It is larger than an apartment but smaller than a suburban single-family home. It also could be part of the solution to America’s housing affordability crisis.