The prefabricated building market size to reach USD 171 billion by 2025, growing at a CAGR of 8% during the forecast period. The prefabricated building market is likely to grow significantly due to the rise in modular construction, infrastructure development, and the growth in residential and commercial sectors. Prefab homes are affordable and can be built in less time, which is expected to positively influence the market in the APAC region due to the growing middle-class population and rapid urbanization. Prefab buildings are energy-efficient and high on sustainability. The increasing awareness of modular construction wastage on the environment has driven people worldwide to adopt the green buildings concept, which is expected to bolster the market, especially in developed regions. Government-sponsored initiatives in developing countries to provide affordable houses in less time is another major factor affecting growth. Prefabricated construction provides structural strength that allows buildings to withstand earthquakes. Hence, prefab buildings are likely to generate demand from seismic-sensitive countries such as Japan, China, Iran, Indonesia, Turkey, Mexico, and Nepal.
- In APAC, the number of urban households is expected to increase by 68% untill 2030, which is likely to bolster the prefabricated building demand.
- Germany is expected to observe its market share of prefabricated 1+2 family housing increase from 20.8% in 2014 to 23.5% in 2022.
- Saudi Arabia’s homeownership strategy that estimates 70% of residents possessing homes by 2030, which is likely to influence market growth positively.
Prefabricated Building Market: Segmentation
This research report includes a detailed segmentation by
INSIGHTS BY APPLICATION
Increasing commercial spaces such as shopping malls, trade centers, and office spaces are expected to drive the prefabricated building market growth. The high investment by key players in their product portfolio due to the building’s faster construction methodologies are likely to drive the commercial segment. The application of prefabricated buildings can substantially reduce costs and construction time. These factors are expected to drive government agencies to implement such constructions in cities, states, and municipalities that meet applicable building codes. These types of buildings are proven to be as durable as traditional ones and designed to withstand the heavy daily use of public facilities.
Insights by Material
The application of precast concrete and concrete block is predominantly used in prefab buildings owing to its strength and durability. Concrete provides a thermal barrier allowing heat to escape a structure and help to increase the energy efficiency of the entire framework. The benefits offered by concrete material used in such buildings are likely to boost the prefabricated building demand. Wood-based products such as engineered joists, columns, and wall and floor structures offer increased strength and are lightweight. These wood-based products weigh less, which helps in increasing the simplicity of shipping and recyclability, which is likely to stimulate the demand for prefab wooden houses.
Insights by System
Cellular systems play a vital role in the development of multidimensional structures. These systems are predominantly used for constructing cells that provide isolation in buildings. As the market of prefabrication is rapidly growing, the application of cellular systems is likely to be widely taken in use, which is expected to fuel the market growth during the forecast period. The demand for panel systems is expected to increase on account of its unique offerings such as accelerated construction time, high thermal efficiency, and low labor costs. However, these systems are expensive and have high capital costs, but long-term savings can balance these costs from reduced energy costs. Skeletal frameworks are primarily used for structures that are relatively low-risk and do not have several partitions. The application of such frameworks is majorly used in large-scale car parking and commercial buildings built with frames. With the rapid growth of urbanization and increasing construction of commercial spaces worldwide are likely to boost the demand for skeletal systems.
Insights by Geography
In North America, the productivity of several modular construction projects has slowed down due to a labor shortage. Hence, companies are expected to utilize prefabricated construction to complete the project faster. The use of additive manufacturing made using energy-absorbing materials such as micro homes is likely to bolster the industry growth in the region. Further, fast-paced urbanization in emerging areas of the region and growing investment in the real estate sector are other factors driving growth. In Europe, the market is expected to grow at a moderate rate as people increasingly focus on readymade solutions for prefab houses that match their criteria. Acceptance of the manufacturing form, consent processes, durability, and low cost are primary factors expected to boost the demand for prefab buildings.
Moreover, the use of eco-friendly materials in developing high-quality structures is likely to influence the market positively. The prefabricated construction industry in APAC is expected to grow significantly in the next five years. The concept of affordable housing with high sustainability is likely to be increasingly adopted by the growing middle-class population in APAC. Moreover, government initiatives in several countries such as Singapore, China, India, Hongkong, and Pakistan are expected to drive market growth in the region.
Insights by Vendors
The prefabricated building market share is highly fragmented, with several local and international players in the market. The competition among these players is intense. The rapidly changing technological environment is expected to adversely affect vendors as customers expect continual innovations and upgrades in construction. The present scenario is driving vendors to alter and refine their unique value proposition to achieve a strong industry presence. The market concentration in developed countries such as the US and Western European countries is high. At the same time, the industry is in its nascent stage in developing economies such as China and India. The competition between vendors exists on the basis of offerings and pricing. The competition is expected to intensify further with an increase in product extensions, technological innovations, and M&A. Leading international players are likely to expand their presence, especially in the fast-developing countries in APAC and Latin America, to gain more share. Besides, improving global economic conditions is likely to fuel the growth of the market.
The global prefabricated building market research report includes in-depth coverage of the industry analysis with revenue and forecast insights for the following segments:
Segmentation by Application
- Commercial Buildings
- South Korea
- North America
- Saudi Arabia
- South Africa
- Latin America