DUBLIN, March 5, 2024 /PRNewswire/ — The “Residential Construction in North America: Market Share Analysis, Industry Trends and Statistics, Growth Forecasts 2019-2029” report has been added to ResearchAndMarkets.com's offering.
The size of the North American residential construction market is estimated at 0.85 trillion dollars in 2024, and is expected to reach 1.06 trillion dollars by 2029, growing at a CAGR of 4.5% over the forecast period (2024-2029).
Before the epidemic, there was already pent-up demand. It was false to say that millennials preferred renting to owning homes. Simply put, millennials lack the resources to own real estate. Some were affected by the Great Recession as they began their careers; Therefore, they did not have the savings of previous generations. As a result, mortgages became less affordable, as banks were subject to stricter regulations and had to agree to reduce down payments by at least 15-20%. Millennials finally had the opportunity to buy homes, boosting the already competitive market. Lockdowns forced people to save, government stimulus programs improved their purchasing power, and asset values rose sharply. The expectation of more remote employment and the various limitations of COVID-19 also contributed to significant migration movements, which further fueled the purchasing frenzy. Strong investment in USA The residential sector will drive industry spending through 2022.
Cheap real estate supplies and historically low borrowing rates have boosted residential investment. In 2021, growth intensified as a result of increased housing construction activity driven by pent-up demand and improving vaccination rates among the population. Housing demand has also been supported by improvements in the labor economy. Despite this, the Federal Reserve has been forced to raise interest rates in 2022 due to rising inflation and concerns of a recession. Now is the time to update long-standing housing and urban planning regulations and rebalance the imbalance between supply and demand. The price of delay could be a serious social catastrophe caused by the discontent of a large intergenerational group of people with their life circumstances, disproportionately affecting younger generations.
In November 2022, Canada Investments in building construction fell 1.4% to $20.4 billion. Most of the drop (5.6%) came from alberta. While the non-residential sector in Canada grew by 0.2% to 5.5 billion dollarsthe residential sector fell 2.0% to 14.9 billion dollars.
North American Residential Construction Market Trends
800,000 homes must be built annually in Mexico to keep up with demand
To meet the demand, Mexico It will need to invest approximately 4% of its GDP annually in the construction of 800,000 homes over the next 20 years, which is equivalent to 3.87% of the country's GDP. While the number of people living together is decreasing, there is a growing demand for housing in Mexico. In MexicoIn 1990, five people lived in each household, a figure that reached 3.6 per household in 2020. In the coming years, many households in Mexico It will also need to be renewed. According Mexico According to the national statistics office, 57% of homes were built by their owners and many do not respect construction standards.
The real estate market in Los Cabos experienced its hottest year in 2021. With the number of single-family home sales increasing 126% and the median price increasing 49% year over year, it was a first-time sellers' market. Condominium purchases increased 192 percent, with a 19 percent increase in the median price of single-family home sales that increased 126 percent and the median price increased 49 percent year over year. For the first time it was a seller's market. Condo purchases increased 192 percent, with a 19 percent increase in the median price. Although growth accelerated outside the Los Cabos In the region, any backlog of pre-construction and development inventory also disappeared from shelves. Demand for residential options increased significantly in All Saintsa trendy surf town, as well as in Peacethe capital of Lower South.
Canadian Home Buyers Have Rapidly Raised Canadian Mortgage Rates
Mortgage rates in Canada have been growing rapidly as the country's inflation rate, which as of October 2021 was 6.9%, it remained high. Inflation has been declining recently, partly as a result of the Bank of Canada aggressive rate increases, but home prices have also been declining in the Canadian housing market. The New Home Price Index (NHPI) for Canada fell monthly in October 2022 for the first time since November 2019. In November 2022, the same monthly drop persisted. The cost of borrowing will increase as mortgage rates continue to rise as a result of rate increases by the Bank of Canada and rising bond yields. The Bank of Canada raised interest rates by 0.50% in December 2022raising prime rates to 6.45%, the highest level since early 2001. Continued rate increases will take effect in the coming months.
Meanwhile, as the Federal Reserve accelerated its own aggressive rate hike program in October, the USD/CAD exchange rate hit new highs. In July 2021, the CMHC (Canada Mortgage and Housing Corporation) revoked credit guidelines that had previously imposed limitations on mortgage insurance, including credit rating requirements and debt service limits. This change made CMHC insurance more available, making it easier for borrowers to qualify for a mortgage with CMHC insurance. In addition, it is now more difficult to get a mortgage due to the increase in the reference rate for the mortgage stress test that came into force on June 1, 2021. Prospective homeowners will notice a decrease in their mortgage affordability when fixed mortgage rates rise above 4.00% and the mortgage stress test exceeds 5.25%.
Overview of the residential construction industry in North America
from North America The home construction market is highly fragmented and no player has a significant share that can influence the market. The market has numerous home manufacturers and service providers. The market presents opportunities for growth of businesses over the forecast period, which is expected to further drive competition in the market. The market is expected to grow during the forecast period due to rising investments in prefabricated housing construction, upcoming major projects in the country, and other factors. The main players are Lennar Corporation, DR Horton, PulteGroup, NVR, Mill Creek Residential and Taylor Morrison.
Key topics covered:
1. INTRODUCTION
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET OUTLOOK
4.1 Current economic and residential construction market scenario
4.2 Technological Innovations in the Residential Construction Sector
4.3 Impact of government regulations and initiatives on the industry
4.4 Industry value chain analysis
4.5 Comparison of construction cost metrics of North American countries (analyst view)
4.6 Impact of COVID-19 on the Market
5 MARKET DYNAMICS
5.1 Drivers
5.2 Restrictions
5.3 Opportunities
5.4 Industry attractiveness: Porter's five forces analysis
6 MARKET SEGMENTATION
6.1 By property type
6.1.1 Single-family
6.1.2 Multifamily
6.2 By type of construction
6.2.1 New construction
6.2.2 Renewal
6.3 By region
6.3.1 USA
6.3.2 Canada
6.3.3 Mexico
7 COMPETITIVE LANDSCAPE
7.1 Overview of market concentration
7.2 Company profiles
- Lennar Corporation
- Dr Horton
- Pulte Group
- NVR
- Mill Creek Residential
- Taylor Morrison
- Start
- Wooden partners
- Meritage Homes Corp.
- Residential Alliance
- Clayton Properties Group
- LMC Residential
- The Michaels Organization
- LGI Houses
- Communities of the century
- Toll Brothers Construction Company
8 MARKET OPPORTUNITIES AND FUTURE TRENDS
For more information about this report visit https://www.researchandmarkets.com/r/trdnrd
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