Siding Demand to Grow 8.4 Percent Annually Through 2016

Demand for siding in the US is forecast to advance 8.4 percent per year through 2016 to 96.5 million squares, valued at $11.4 billion.  Growth will be spurred by a rise in housing completions from a depressed 2011 base.  Although housing completions will remain below the level reached at their cyclical peak in 2006, the recovery will fuel above average gains in the residential siding market through 2016.  These and other trends, including market share and product segmentation, are presented in US Siding, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.  

Among material types, brick, stucco, and fiber cement siding are forecast to see the most rapid demand gains through 2016, rising at double-digit paces.  The South and West regions of the US -- where these materials are most often installed -- are forecast to see the strongest growth in population and housing activity through 2016.  Brick and fiber cement see wide use in the South, while stucco is most commonly used in the West region.  Fiber cement siding will continue to take market share from other materials, such as vinyl and wood.  Fiber cement siding demand will also be supported by continuing consumer acceptance of the material because of its performance properties, such as resistance to degradation caused by insect attack and moisture.

Vinyl siding accounted for the largest share of siding demand in 2011, with a 37 percent share of the market in area terms.  Vinyl siding will continue to lead the market in 2016,  with insulated vinyl siding and products that better resemble natural materials such as wood and stone promoting demand.  However, competition from fiber cement and stucco siding will check growth.  Fiber cement and stucco siding offer end users better long-term durability.

Residential improvements and repairs were the largest market for siding in 2011, reflecting the low level of new housing activity in that year.  Generally, new housing is the largest market for siding, as most siding materials are not replaced unless they are severely worn or damaged.  Nonresidential demand for siding is forecast to rise 6.4 percent annually to 22.5 million squares in 2016.  Gains will be driven by increasing nonresidential building construction.  The office and commercial and lodging segments, which experienced the most rapid siding demand declines of all nonresidential market segments between 2006 and 2011, will see the strongest growth going forward as more office buildings and retail sites are erected. 

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.