Market Trends of UAE Manufactured Homes Industry
This section covers the major market trends shaping the UAE Manufactured Homes Market according to our research experts:
Rapid Urbanization in UAE Boosts the Demand for Manufactured Homes
Rapid economic growth, which occurred in Dubai after the oil boom of 1973, was accompanied by population growth and increased urbanization. There has been a massive migration of the population from rural to urban areas, as well as immigration of foreign labor into Dubai. In the UAE, 87.3 percent of the population lived in urban areas in 2021, according to World Bank.
To accommodate the more and more population shifting towards urban areas, the need for quick and reliable housing is accelerated. People are shifting their focus to manufactured homes rather than traditional construction. Dubai-based LINQ makes modular houses, created as a series of parts that can be shipped and assembled anywhere in the world. This system can build homes 40% faster than regular construction, according to the company, and the ultimate goal is to be able to provide homes to countries that have an increasing demand for housing. Thus, the demand for manufactured homes is strongly driven by rapid urbanization in UAE.
With the increase in the number of people living in urban centers, there is a continued scarcity of homes. Manufactured homes offer an affordable homeownership option for some families, and the improvements in their quality and safety have made them a more desirable option in recent decades. This is expected to drive the growth of the manufactured housing market during the forecast period.
Increasing Demand for Prefabricated Homes in UAE
The economy of the United Arab Emirates is the 5th largest in the Middle East (after Iran, Saudi Arabia, Turkey, and Egypt), with a GDP of USD 501 billion (AED 1.84 trillion) in 2022. Money spent on the construction industry is increasing in UAE; however, developers or manufacturers are looking to decrease the cost and time of construction. This has led to more production of manufactured homes, as they are built in a factory, require less labor, and the overall construction time required is less. These factors are expected to drive the market in the future.
According to the Ministry of Energy and Infrastructure (UAE), in 2020, around 92.8 thousand homes were built in the emirate of Abu Dhabi alone, followed by 41 thousand in the emirate of Sharjah and 35 thousand home units in the emirate of Dubai. The total number of homes in the entire United Arab Emirates was projected at 231.2 thousand. According to trade map data, in the year 2021, USD 74464 thousand prefabricated buildings were imported. Massive construction is on the boom, and an expanding manufacturing base and a thriving services sector are helping the UAE diversify its economy. Nationwide, there is currently USD 350 billion worth of active construction projects.
Moreover, people are getting attracted to manufactured housing as they provide features such as a bright modular kitchen, spacious bedroom, a cozy fireplace, walk-in closets, a garden tub, plus crown molding, and branded home appliances. This drives the growth of manufacturing homes in the UAE.
