Market Trends of Europe Prefabricated Housing Industry
Huge Demand for Multi-family Houses Driving Market Growth
- Germany is Europe's largest multi-family market, which is worth approximately EUR 8 billion in investment. Denmark and France ranked second and third with about EUR 5 billion and EUR 3.5 billion, respectively.
- The United Kingdom is experiencing significant demand for housing, particularly in urban areas. Such demand is likely to continue or even increase in the long run. Converting office spaces into multi-family properties provides an opportunity to capitalize on this demand.
- Construction completions of 140,900 units in Q4 2023 brought the annual total to 416,500—the highest amount since 1996. Reduced construction starts in recent quarters are expected to lower deliveries in 2025 and beyond. Q4 2023 multi-family investment volume of USD 25.7 billion brought the annual total to USD 117.5 billion, down by 60% from 2022. However, the sector retained the most significant investment volume of commercial real estate at 32%.
- In September 2023, asset and investment manager MPC Capital expanded its leading role in the market for ESG real estate investments. The property comprises two multi-family houses with around 7,000 sq. m of living space spread over 113 residential units. In addition, the property, completed and fully rented in mid-2022, includes 39 underground parking spaces and one commercial unit. The property is in the Pankow district, within walking distance of the famous Prenzlauer Berg district.
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The United Kingdom is Dominating the Market
- While technology has revolutionized many aspects of life, including transportation, entertainment, shopping, and consumer goods, housebuilding has been slow to catch up. That is all set to change with the introduction of the next generation of factory-built modular homes.
- A new report from Make UK Modular, in collaboration with KOPE, has revealed that by 2025, the modular housing industry will be able to provide 20,000 energy-efficient, low-carbon homes across the United Kingdom. These homes will be 55% less likely to need to be heated than the average UK family house and will be built twice as fast.
- Modular manufacturers are already setting up plants in post-industrial small towns or cities, employing more than 3,000 people, and bringing GBP 700 million (USD 860.10 million) of investment to low-growth, low-employment areas.
- The government has expedited the planning process for modular homes and committed to 20% of the affordable housing program for modular homes, which would double new jobs in a short period.
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