USD 104.67 Billion
Report ID:
SQMIG20C2036 |
Region:
Global |
Published Date: May, 2025
Pages:
192
|Tables:
87
|Figures:
76
Global Modular Construction Market size was valued at USD 104.67 Billion in 2023 and is poised to grow from USD 112.62 Billion in 2024 to USD 202.36 Billion by 2032, growing at a CAGR of 7.6% in the forecast period (2025-2032).
The rising demand for sustainable as well as efficient building solutions has been one of the major driving forces behind the development of this industry. Technological advancement has enabled rapid project completion, reduced labor fees, and reduced waste of materials, making it appealing to developers as well as clients in search of cost-effective construction. Rapid urbanization and the need for more affordable dwellings have further encouraged stakeholders to adopt such innovative construction techniques.
On the positive side, the shift toward green practice has also helped industry growth. Prefabrication is less material- and waste-intensive than traditional forms of construction, which aligns with global initiatives to reduce environmental impact. Governmental incentives promoting green construction procedures and the implementation of supportive policies further facilitated the shift for organizations to invest in such systems, driving levels of adoption across industries such as residential, commercial, and industrial.
However, the industry is faced with challenges that may hamper its growth. The regional inconsistency of regulation is likely to make adoption more difficult and increase the cost of compliance. Furthermore, structural durability problems and limited customization levels compared to traditional building processes have deterred possible adopters. Despite these problems, ongoing research and development effort targets eliminating these problems, ensuring the long-term viability of this process of construction.
How is Artificial Intelligence Transforming the Modular Construction Market Landscape?
Artificial intelligence is revolutionizing the construction industry by enhancing efficiency, precision, and creativity. Autodesk is a company that is integrating AI into construction processes to boost productivity and reduce errors. Engineers in India are impacting this sector by designing AI capabilities for infrastructure projects. Hickory, an Australian building firm, has also established an advisory board to encourage AI adoption and creativity in modular construction to counter challenges such as labor shortages and sustainability.
Startups are also making tremendous strides in this field. Scalera.ai, a Swiss startup company, has developed an AI-powered assistant to streamline procurement and tendering procedures in construction, reducing manual intervention and enhancing efficiency. Automated Architecture (AUAR) in the UK is using robots to build homes, aiding in the housing crisis by building houses affordably on-site with portable "microfactories". These technologies reflect the global trend of integrating AI in construction to enhance productivity and keep up with heightened demands.
Market snapshot - 2025-2032
Global Market Size
USD 104.67 Billion
Largest Segment
Residential
Fastest Growth
Residential
Growth Rate
7.6% CAGR
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Global Modular Construction Market is segmented by Type, Material, Module, End Use Sector and region. Based on Type, the market is segmented into Permanent, and Relocatable. Based on Material, the market is segmented into Steel, Wood, and Concrete. Based on Module, the market is segmented into Four-sided, Open-sided, Partially open-sided, Mixed modules & floor cassettes, Modules supported by a primary structure, and Others. Based on End Use Sector, the market is segmented into Residential, Office, Education, Retail & Commercial, Hospitality, Healthcare, and Others. Based on region, the market is segmented into North America, Europe, Asia Pacific, Latin America and Middle East & Africa.
The residential segment leads due to booming global housing demand, urbanization, and a need for affordable, sustainable solutions. Modular building means quicker construction times—homes can be built in 10–12 weeks—saved cost, and solving labor shortages. Governments are heavily investing; an example is that of Australia's USD 54 million project that plans to build 1.2 million houses by 2029 through modular means. Furthermore, the ability of modular homes to fit many different designs and local building codes increases their popularity, securing residential modular construction as the global leader.
The healthcare sector is experiencing a rapid growth in modular construction due to an increased demand for flexible, efficient, and quickly deployable medical facilities. Modular building allows for medical facilities to be expedited assembled, which is vital in meeting urgent healthcare needs. For instance, the U.S. Department of Health & Human Services has invested significantly in modular hospital facilities in order to enable disaster preparedness and rural access to healthcare. Moreover, the Government of Canada has committed USD 2 billion for modular healthcare facilities under its Health Infrastructure Program, another stimulus to regional market development. The trends indicate the increasing reliance of the industry on modular construction solutions to meet evolving healthcare infrastructure needs.
The permanent type is at the forefront of modular construction since it remains adaptable to long-term infrastructure needs and regulatory demands. Governments worldwide are deeply committing to permanent modular solutions in order to meet housing gaps and infrastructure demands. For instance, Australia's USD 54 million National Housing Accord plan centers on constructing 1.2 million dwellings by 2029 and prioritizing prefabrication and modular construction use. Even the Swedish housing market observes nearly 80% of new homes being constructed with modular solutions, thanks to favorable government policies and incentives.
The relocatable category is developing well in modular construction with its portability and affordability. Industries and governments around the globe are moving fast to adopt relocatable buildings for temporary dwellings, school structures, and emergency relief buildings. For instance, Australia's DC Constructions NQ is endeavoring to end homelessness by constructing cyclone-rated, council-accepted transportable homes, which will increase production threefold to satisfy demand. In addition, Modular Building Institute reports that the revenue of relocatable buildings surpassed USD 4 billion in 2023, highlighting its increasing role in the global market
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North America has the largest market share due to proactive infrastructure spending, large technology adoption, and proactive government incentives for modular building. The United States leads in affordable housing projects and healthcare facility projects, while Canada leads in green building, generating demand in residential, commercial, and healthcare markets for fast, low-budget construction options.
United States is the leading modular construction market in North America, driven by acute shortages in housing and increased healthcare facility demand. Programs like government assistance for affordable housing by the Department of Housing and Urban Development have driven adoption. New initiatives include the U.S. Army Modular Rapid Response Housing programs, with the focus on the use of rapid deployment in times of emergency. Companies such as Katerra (before restructuring) and Guerdon Modular Buildings have been pioneers, focusing on sustainable, affordable, and time-efficient modular options. The rise in urbanization and labor scarcity also add to the growth of the market.
Canada is growing rapidly in modular building due to government incentive toward green and energy-efficient buildings. The USD 2 billion Canadian government Health Infrastructure Program stimulates modular hospitals and clinics to increase health access, specifically in rural areas. Developers apply cold-climate modular solutions to offset regional challenges. Modern Buildings Inc. and NRB Modular Solutions lead the way by offering customizable and durable modular units. Increased urbanization and need for affordable housing in cities like Toronto and Vancouver drive the growth, with sustainability and reduced construction timelines key drivers.
Asia Pacific is the region's most rapidly expanding modular building market, driven by rapid urbanization, subsidized housing government policies, and increasing investments in Chinese, Indian, and Australian infrastructure. Labor costs and efforts toward sustainable, time-saving construction methods are driving adoption in residential, commercial, and healthcare areas.
China leads Asia Pacific's modular building market, driven by massive urbanization and government incentives for prefab housing to meet housing shortages. The Chinese government's "Green Building Action Plan" promotes efficient and sustainable building. Businesses such as Broad Group have led the way in modular skyscrapers, demonstrating fast assembly ability. Recent instances involve massive modular hospital constructions completed in a matter of days amid the COVID-19 pandemic, which demonstrates the industry's flexibility. Increasing labor costs and green regulations also increase the demand for waste-cutting and time-saving modular approaches, making China an international modular construction leader.
India's modular construction industry is growing rapidly due to pressures on city dwellers and government subsidized residential schemes like PMAY (Pradhan Mantri Awas Yojana). The prefab technology is promoted by the government to speed up the provision of houses and save costs. BLC India and Tata Steel are some of the firms that have introduced steel modular solutions suitable for India's fluctuating weather conditions. Recent developments include private-public partnerships to mass-produce modular schools and clinics. Increased focus on sustainability and the shortage of labor further drive adoption, making India a prime emerging market in Asia Pacific's modular building market.
The modular construction market of Japan grows steadily due to its focus on disaster-resistance and space-efficient housing. With a quickly aging populace and frequent natural disasters, modular homes offer quick, durable alternatives. Seismic-resistant prefabricated buildings are promoted by the government, benefiting vendors such as Sekisui House and Misawa Homes. Technology includes AI-infused factory manufacture for higher accuracy. New trends aim at eco-friendly, high-tech modular modules with which to fill urban spaces. Japan's strong manufacturing base and focus on quality guarantee steady market growth.
Europe's modular building sector is moving forward aggressively, driven by stringent environmental laws, housing shortage, and demand for energy-efficient construction. The UK, Germany, and Sweden are spearheading adoption, supported by government incentives and innovation by top players in sustainability, speed, and lower cost in domestic and commercial construction.
The UK leads the modular construction sector in Europe due to acute housing shortfalls and strong government backing of offsite construction. Policies like the UK Government's "Transforming Construction" policy promote modular methods to boost productivity and sustainability. Legal & General Modular Homes and ilke Homes focus on delivering affordable, sustainable homes. Recent developments include high-rise modular residential projects in London and Manchester with up to 50% reduced build time. Government encouragement of net-zero carbon buildings also fuels the adoption of modular construction for residential and commercial uses.
Germany is a leading European market, fueled by rigorous building codes and growing demand for energy-efficient and green buildings. The German government offers funding schemes and research efforts such as the "Future Bau" project to encourage modular construction. Large firms, including Zublin and KAMPA, are committed to prefabricated timber and concrete modules. Upcoming projects highlight low-cost housing and modular office spaces with stringent environmental regulations. Germany's focus on reducing construction waste and carbon emissions is supportive of embracing modular construction, especially in densely populated areas with pressure on housing demand.
The prefabricated construction sector in France grows with the focus on eco-friendly, low-cost housing and environmental goals. The French government also encourages prefab through incentives based on the "Plan Batiment Durable" with energy efficiency. Bouygues Construction and Algeco are some of the companies leading with modular apartments and offices. Recent projects include prefabricated social housing blocks in Paris and prefabricated healthcare facilities to reduce construction time and costs. Urban densification and shortage of labor fuel the popularity of modular construction, along with France's evolving legislation in support of sustainable, high-speed solutions.
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Faster Urbanization and Housing Demand
Government Incentives and Policy Support
Regulatory and Building Code Complexities
High Initial Capital Investment
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The global competitive environment for modular construction is highly competitive with market domination by large companies such as Laing O Rourke, Katerra, and Guerdon Modular who operate through sophisticated technologies and strong government co-operation. Governments worldwide are facilitating co-operation by means of public-private partnership and grants for innovation; for example, the UK's Innovate UK has provided over USD 150 million for researching and developing modular construction. In addition, companies focus on digitalization and sustainability, supported by regulatory regimes like Japan's Smart City Initiative to drive prefab solutions. Strategic alliances and mergers are common in order to expand geographic presence and supply chain strength and align government aspirations with low-cost, rapid housing development and infrastructure development across the globe.
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected using Primary Exploratory Research backed by robust Secondary Desk research.
As per the analysis of SkyQuest, strong growth in the modular construction market is expected to be driven by government incentives, increased demand for sustainable, affordable housing, and swift urbanization through to 2032. Regulatory intricacies, high initial capital investment, and supply chain concerns are expected to impede mass adoption in the long run. Strong policy support, advanced integration of digital technology, and focus on healthcare infrastructure development are supporting North America to maintain its leadership position. Constant innovation in the context of automation and eco-friendly material will go a long way in building new opportunities for market players around the globe.
Report Metric | Details |
---|---|
Market size value in 2023 | USD 104.67 Billion |
Market size value in 2032 | USD 202.36 Billion |
Growth Rate | 7.6% |
Base year | 2024 |
Forecast period | 2025-2032 |
Forecast Unit (Value) | USD Billion |
Segments covered |
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Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
Companies covered |
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Table Of Content
Executive Summary
Market overview
Parent Market Analysis
Market overview
Market size
KEY MARKET INSIGHTS
COVID IMPACT
MARKET DYNAMICS & OUTLOOK
Market Size by Region
KEY COMPANY PROFILES
Methodology
For the Modular Construction Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Modular Construction Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
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With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Modular Construction Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
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Innovation Mapping: Identify racial solutions and innovation, connected to deep ecosystems of innovators, start-ups, academics, and strategic partners.
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Global Modular Construction Market size was valued at USD 104.67 Billion in 2023 and is poised to grow from USD 112.62 Billion in 2024 to USD 202.36 Billion by 2032, growing at a CAGR of 7.6% in the forecast period (2025-2032).
The global competitive environment for modular construction is highly competitive with market domination by large companies such as Laing O Rourke, Katerra, and Guerdon Modular who operate through sophisticated technologies and strong government co-operation. Governments worldwide are facilitating co-operation by means of public-private partnership and grants for innovation; for example, the UK's Innovate UK has provided over USD 150 million for researching and developing modular construction. In addition, companies focus on digitalization and sustainability, supported by regulatory regimes like Japan's Smart City Initiative to drive prefab solutions. Strategic alliances and mergers are common in order to expand geographic presence and supply chain strength and align government aspirations with low-cost, rapid housing development and infrastructure development across the globe.'Cavco Industries, Inc. (USA)', ' Sekisui Chemical Co., Ltd. (Japan)', ' ATCO Ltd. (Canada)', ' Bouygues Construction ', 'Red Sea Housing Services (Saudi Arabia)', ' Laing O Rourke (UK)', ' Kleusberg GmbH & Co. KG (Germany)', ' Modulaire Group (UK)', ' Skanska AB (Sweden)', ' Balfour Beatty plc (United Kingdom)', ' ACS Actividades de Construccion y Servicios S.A. (Spain)', ' Lendlease Corporation (Australia)', ' Bechtel Corporation (USA)', ' Fluor Corporation (USA)', ' Vinci SA (France)', ' Daiwa House Industry Co., Ltd. (Japan)', 'Clayton Homes (USA)', ' CIMC Modular Building Systems (China)', ' Algeco Scotsman (USA)'
Rapid urbanization, with 68% of the global population projected to be urbanized by 2050 (UN, 2023), fuels the demand for housing. Governments all over the world, like India's PMAY aiming at 20 million affordable housing units, are adopting modular construction for faster delivery. Industry giants like Katerra and Guerdon Modular deliver projects 50% faster at half the costs. Modular houses are promoted by the U.S. HUD to address the shortage and Australia is investing USD 54 million in modular housing schemes, which is a reflection of global reliance on modular methods to overcome the urban housing issues efficiently.
Growing Focus on Sustainable Modular Construction: Governments worldwide are focusing on sustainability, with the EU's Green Deal investing over USD 600 billion in green building innovation, including modular processes. This puts a premium on the use of recycled material and low-energy building designs, supported by policies, encouraging manufacturers to create more environmentally friendly modular solutions in line with global carbon reduction targets.
What makes North America the top market for modular construction in 2024?
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