North America and Western Europe to Drive Growth in Construction of New Housing Units
Worldwide construction of new housing units is forecast to increase 3% annually to 62.6 million units in 2019, according to “World Housing,” a recent study from the Freedonia Group, Inc. While global population growth is expected to decelerate, declines in average household size will still allow the number of households in the world to increase 1.6% annually, boosting demand for new housing. In addition, increased rural-to-urban migration, especially in developing countries, will spur construction of new housing units in urban areas.
North America and Western Europe are expected to experience the most rapid growth in new housing units through 2019. “In both cases, gains will be off a depressed 2014 base, with many countries recovering from the collapse of housing bubbles,” said Nick Cunningham, analyst.
Several of the countries that experienced the most severe downturns, including the U.S., Ireland, Italy, Portugal, and Spain, will experience double-digit annual increases in new housing units, although in most cases 2019 levels will remain substantially below those in 2004. On a global basis, multi-family units are forecast to experience faster gains in new construction than are single-family units, as a result of increasing urbanization in developing countries. Rural-to-urban migration will be particularly strong in the two most populous regions (Asia-Pacific and Africa/Mideast), and those new urban residents will boost demand for multifamily housing. Construction of new multi-family units worldwide is forecast to advance 3.7% per year through 2019; in that year, more than 80% of new housing units will be built in the Asia-Pacific and Africa/Mideast regions.
Additional details are available at www.freedoniagroup.com.