Market Trends of United Kingdom Prefab Wood Buildings Industry
This section covers the major market trends shaping the UK Prefab Wood Buildings Market according to our research experts:
Timber Buildings Witnessing Significant Growth
Timber is widely adopted in buildings prefab structures in the United Kingdom, to achieve net zero emission targets. In addition, in 2022, according to the Structural Timber Association (STA), the government encouraged the increasing use of wood as a building material to meet both housebuilding targets and its climate change commitments.
Moreover, in October 2022, fully prefabricated wood wall adoption witnessed significant growth, these walls are highly utilized as building envelopes, which has reduced energy consumption significantly in the country. In addition, the growing housing crisis in the country is driving the wooden modular homes.
According to national statistics, in Q1 2022, new home registrations increased by 25%, and more than 45,900 new homes were built, at a growth rate of 26% when compared to the same period of the previous year. Despite the increasing housing sector, the country is still facing a housing crisis, which will drive wooden prefab homes. Moreover, to meet the increasing demand for timber construction, timber products are widely imported into the country. In addition, in the first half of 2022, timber prices soared. Also, the price index of imported sawn or planed wood increased from 188 in 2021 to 214 by June 2022.
Increasing Costs of Construction is Driving the Market
The United Kingdom is witnessing a rise in construction costs past two years. In addition, the Russia-Ukraine war and soaring inflation are adding even more pressure on construction costs. Moreover, as per the Building Cost Information Service (BCIS) Materials Cost Index, the cost of construction materials has reached more than 17.5% growth when compared to the previous year. Moreover, in 2021, the cost of materials in constructing a three-bedroom, semi-detached house increased by 14%, which was around EUR 7,300 (USD 7,900), and further increased by 1%, which is approximately EUR 600 (USD 650) in 2022.
Moreover, in 2022, labor shortages emerged as the major driver of construction cost growth. According to Office for National Statistics, more than 1.3 million vacancies were recorded in March to May of 2022. Meanwhile, structural metals used in domestic construction have steep price growth, and August 2021 and September 2021 saw price rises of 13.4% and 15.7%, respectively, compared with similar periods in 2020.
Meanwhile, the growing construction costs drive the public to choose prefabricated wooden houses over conventional buildings. In addition, the country's construction cost reached an annual growth rate of almost ten percent in July 2022. Thus, the increasing construction prices resulted in consumer shifts towards modular housing adoption.
