Market Trends of Prefabricated Housing Industry
Expansion Of Prefabricated Housing To Drive The Market
Prefabricated housing was once a temporary solution to a problem in recent history, but it soon turned into a long-term fix. Prefab houses are seeing a modern comeback throughout Europe, accounting for 23% of the country of Germany's housing stock. The UK construction company TopHat is growing and plans to create a massive factory the following year that can produce one modular home per hour.
In the United States, there is an apparent demand for more housing. According to industry reports, at the end of 2023, there was a shortage of around 3.2 million homes. The Great Recession caused a more than ten-year underproduction, accompanied by labor shortages and supply chain issues brought on by the pandemic. Experts predict that in the next five years, the United States will need to construct roughly 1.7 million new homes yearly to close the housing gap.
Humungous preference for project homes, mid-rise residential constructions, and public housing projects will steer the growth of the prefabricated housing industry in Europe. Massive demand is seen for one and two-family houses in countries such as Austria, Germany, Italy, Poland, Switzerland, the United Kingdom, and Scandinavia.
As evidenced by the increasing production of cross-laminated timber in Italy, there is also a growing prefabricated market for wood goods. As of 2022, in the DACH region, Germany, Austria, Switzerland, and the Czech Republic produced over 750,000 m3 of CLTs per year, while Italy is growing at an annual rate of 10%.
Legal & General Modular Homes, in particular, formed a strategic collaboration with affordable housing provider Vivid in December 2022, with plans to produce 1,000 prefabricated homes annually in the United Kingdom.
Governments' Investments And Plans In Residential Housing To Boost The Prefab Industry
The global value of assets amounted to USD 379.7 trillion at the end of 2022. The longer-term trend shows that, over the last three years, global property remained an essential source of wealth and is growing at 18.7%. The combined value of real estate is higher than equity or bond markets, which are nearly four times the size of global gross domestic product. The value of all the gold ever mined, USD 12.2 trillion, is paltry by comparison, a little over 3% of the value of global real estate.
In 2023, EPACK PREFAB, a manufacturer of pre-engineered building solutions, expanded its manufacturing footprint with an investment of INR 198 crore (USD 23.75 million) to set up a new facility spread over 25 acres in Andhra Pradesh.
PEB structures are used in many industries, including aviation, to construct small airports, stadiums, and commercial and residential projects. It has two manufacturing plants in Rajasthan and Greater Noida, with a total capacity to produce 1,00,000 metric tonnes of prefabricated material annually, which will increase to 200,000 metric tonnes with the third plant.
In Saudi Arabia, luxury resorts constructed under the Red Sea project will include prefabricated overwater and beach villas. Red Sea Global also reported 73 prefabricated villa units arriving at the site on January 23, 2023. The prefabricated construction market in Saudi Arabia will continue to be stimulated by the installation of these units.
In 2023, Plant Prefab, a construction technology company dedicated to sustainable design, materials, and operations, announced that it secured a follow-on equity investment of USD 2 million from Mexico-based structural steel fabricator TEMSA. The investment will bring the total amount raised by Plant Prefab from its recent Series C financing of USD 44 million, which is used to complete the company's first automated production facility and regional manufacturing center in Tejon Ranch, California. The 270,000 square feet of the Tejon Ranch Hub will support Plant Prefab's expansion into more significant multiunit and multifamily housing production, allowing it to serve the entire western United States.
