Prefabricated housing shipments are forecast to rise 13.6 percent annually through 2017 to 140,000 units, a vast improvement from the declines of the 2007-2012 period. Prefabricated housing will benefit from a rebound in housing starts. Both types of prefabricated housing declined steadily from 2002 on, and were hit hard by the housing market collapse that began in 2007. As the housing market and general economy recover, demand for prefabricated housing is expected to rise along with total single-family housing starts. Despite the promise of some reduction in construction costs, these products have had limited market penetration, in part because of consumers’ familiarity with traditional construction practices, or in the case of manufactured housing, some stigma attached to the product itself. These and other trends, including market share and product segmentation, are presented in Prefabricated Housing, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.
Overall, shipments of manufactured housing will reach 90,000 units in 2017. Demand for manufactured housing is concentrated in rural areas and in certain segments of the population -- particularly lower income groups such as young, first time home buyers and those over 55, such as retirees on a fixed income. Expected growth in these populations will boost manufactured housing demand. However, manufactured housing’s market share is projected to drop from that of 2012 as the economy continues to expand and conventional mortgages become easier to obtain, and as new regulations make chattel loans (commonly used for manufactured housing) more difficult to secure.
For other prefabricated housing, demand is more evenly spread throughout geographical areas and the segments of the population. As such, demand is less
affected by trends in certain areas or populations, and will more closely track demand for overall single-family housing. Therefore, market shares for other prefabricated housing types will be little changed, and demand increases will be similar to those for single-family housing overall.
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.