US Asphalt Shingles Market – Industry Research Report

Report Overview

Featuring 119 tables and 21 figures

What product trends in asphalt shingles are driving demand?

• Durability & long lifespans boost market share for high-performance laminated shingles demand

Demand for asphalt shingles in the US is forecast to decline 1.1% per year to 158.6 million squares in 2028. This will largely be caused by:

• declining residential reroofing activity after the surge that occurred from 2020 to 2023; those homeowners who replaced older or worn roofs will be unlikely to do so again in the near term

• increasing use of more durable roofing materials, which will limit future growth opportunities in reroofing applications

However, opportunities still exist in the new residential and commercial markets, as single-family housing and office and hotel construction are expected to rise through 2028.

Durability & Long Lifespans Boost Market Share for High-Performance Laminated Shingles

High-performance laminated shingles will be the only asphalt shingle type to see gains through 2028, and they will continue to gain market share due to their superior performance properties. Their high-wind resistance allows them to meet the more stringent weather-resistant building codes that are increasingly being adopted in coastal jurisdictions and those parts of the US where tornadoes and hailstorms occur frequently. Additionally, high-performance laminated shingles offer long lifespans that potentially allow homeowners to avoid replacement for as long as they own their homes.

New Construction Applications Offer Better Opportunities for Asphalt Shingles

Although they account for a much smaller share of demand, new construction applications will offer better opportunities for asphalt shingle suppliers than reroofing applications:

• Demand in new residential roofing applications is forecast to rise as single-family housing starts return to growth in 2024 following two consecutive years of declines, when housing construction was hampered by labor issues, elevated material costs, and high interest rates. While standard laminated shingles will remain the most popular asphalt shingle type for these homes, high-performance laminated shingles will see greater usage due to their ability to better withstand severe weather conditions.

• Demand in new commercial roofing applications will be supported by increasing construction of hotels and smaller office buildings following declines during the latter part of the historical period, when the pandemic created a seismic shift in domestic travel and in-office work.

Historical Market Trends

Shifts in demand for asphalt shingles can vary from year to year and are determined by numerous factors, primarily those related to building construction activity. They include:

• levels of housing starts, particularly in the single-family housing segment

• the size and age of the US housing stock

• interest rates – low interest rates may encourage home and business owners to take out lines of credit often used to fund roof repair and replacement projects

• the type of roof (e.g., steep-slope or low-slope) installed on a structure that will be repaired or replaced

The US has a significant number of homes and businesses with roofs that are at or near the end of their life expectancies. Thus, age-related reroofing is the most significant driver of asphalt shingle demand in the US.

Additionally, multiple other variables can affect demand for asphalt shingles in a particular year or over a short period of time. Among these are:

• weather conditions, especially outbreaks of severe weather that can cause widespread damage to roofs (e.g., hurricanes and tropical storms, tornadoes, hailstorms, and winter storms)

• changes and modifications to state and local building codes

• the adoption of legislation that can cause a temporary increase in reroofing activity

• insurers requiring homeowners to replace old or worn roofs with newer materials that better resist severe weather on condition of maintaining coverage

• changes in the price of asphalt that can cause the cost of roofing materials per square to increase or decrease sharply

Asphalt shingle demand in volume terms advanced rapidly in 2020, a marked contrast to the demand levels of 2018 and 2019. This growth was spurred by multiple outbreaks of severe weather across the US and an increase in residential roofing demand precipitated by the COVID-19 pandemic. Real demand levels increased again in 2021 despite continued restraint from supply chain issues and increased inflation. However, these supply chain issues caused market value to grow 19% in that year. Asphalt shingles demand in volume terms declined in 2022 due to a loss in housing starts and weakness in commercial building construction, but market value continued to exhibit growth because of continuing inflation and supply chain disruptions. Asphalt shingle demand – both in value and volume terms – grew in 2023, due to high levels of reroofing activity after severe weather events and an increase in commercial building construction.

New vs Reroofing Shingle Demand

Demand for asphalt shingles is anticipated to fall 1.1% per year to 158.6 million squares in 2028.

New roofing applications will see growth through 2028 due primarily to an increase in single-family home construction. New commercial building construction will also support some gains. However, new applications for asphalt shingle roofing will account for the smaller share.

The reroofing segment remains the driving force behind the US roofing market due to its large stock of older single-family houses and commercial buildings. Additionally, many regions experience severe weather that necessitate regular replacement or repair of existing roofs; the anticipated decline in reroofing demand is partially attributable to unusually high weather-related reroofing activity in 2023.

Pricing Trends & Inflation

Pricing levels for roofing vary greatly due to the large number of products used as roofing materials and their differing costs. Factors that generally impact the prices of roofing products include:

• the prices of key raw materials (asphalt)

• production costs (manufacturing equipment, energy)

• transportation expenses for delivering finished products to distributors

• labor, as many industries have difficulty finding skilled workers to operate and maintain production equipment

Asphalt shingle prices jumped in 2021 and continued to grow at a double-digit pace in 2022 because of pandemic-driven inflation. Residential roofing demand increased greatly in 2020 and 2021, due to the high levels of homebuilding and remodeling activity in those years. Supply chain issues abounded since producers struggled to obtain raw materials at prices near their historical norms, which resulted in increased costs for consumers; the lack of trucks and truckers also contributed to greater shipping costs. However, asphalt shingle pricing started to moderate in 2023 as inflationary pressures lessened.

The average price of asphalt shingles is forecast to remain essentially flat through 2028, a significant deceleration from the 2018-2023 period that will be attributable to ongoing pricing normalization.

Competitive Products

Asphalt shingles will continue to be the leading roofing material installed in the US in area terms. However, their share of the market is expected to decline as they continue to face intense competition from products like:

• metal roofing, such as standing seam metal panels

• roofing tile, whether clay, concrete, or porcelain varieties

• small volume roofing products like solar and composite (polymeric)

These products generally offer superior performance properties compared to asphalt shingles, such as resistance to damage caused by high winds and impacts. Additionally, many consumers find that these roofing products enhance the exterior appearances of the structures on which they are installed, boosting property values and attracting visitors and tenants.

Scope

This study analyzes US asphalt shingles demand by product, application (new vs. reroofing), market, and US geographic region. Demand is provided in both area terms (squares) and value terms (US dollars). Historical data (2013, 2018, and 2023) and forecasts for 2028 and 2033 are presented for US asphalt shingles demand in squares and US dollars. In addition, annual data is presented for 2020 through 2027 for all markets and product types in squares and US dollars.

Asphalt shingles product demand is segmented by the following product types:

• standard laminated

• high-performance laminated

• three-tab

Average product prices (at the manufacturers’ level) and installation costs are provided for major product types in dollars per square.

Excluded from the scope of the study are such related products as:

• roofing underlays

• flashings

• coatings used as repair and restorative compounds and not used as a structure’s primary roofing material

• roof-mount solar panels

• mopping asphalts, granules, and ballast used during the installation of bituminous roofs

• prefabricated roof trusses and other structural supports

• roof decking materials (e.g., plywood and other engineered wood materials, concrete, metal)

Demand for asphalt shingles in the residential market is also analyzed by housing type:

• single-family housing

• multifamily housing

• manufactured housing

Excluded from the definition of residential buildings are housing units located in a structure whose primary purpose is something other than habitation. Thus, a small living space contained in a larger retail facility would be classified as part of a retail building and not a residential building

Demand for asphalt shingles in the commercial market is analyzed by building type:

• office, retail, and lodging

• institutional

• industrial

• transportation and other (including civic centers, courthouses, government administrative and public safety facilities, post offices, agriculture facilities, and recreational facilities)