Eight houses fitted with kitchens and bathrooms will roll off the production line every day in Knaresborough, to be loaded on to lorries for delivery across the country. Experts have hailed it a revolution in British housebuilding that would slash the 40 weeks it could take to build a traditional home to just 10 days.

The factory cost of a two or three-bedroom home would be from £65,000 to £79,000, although that excludes the cost of land, on-site assembly and connecting the home to services, which could double or triple the final price.

The plant, operated by the UK company Ilke Homes, said it would produce 2,000 houses a year, rising eventually to 5,000, which would catapult it into the top echelon of volume housebuilders in the country.

Meanwhile, the insurance company Legal & General has built a vast factory outside Leeds which it said would build 3,500 homes a year, with the first two and three-bedroom homes being delivered in the past few weeks. It said it intended to build similar factories in locations across the UK, which would turn L&G into a bigger builder than Persimmon or Barratt Developments.

The term prefab has been shunned by the new housebuilders. The new buzz phrase, with its connotation of low-quality, postwar emergency housing,has instead been described as “modular construction”. Developers have been promising homes built to higher standards than those using traditional methods. They also claim energy bills would be half that of a conventional home due to better insulation.