Global Housing

Report Overview

Featuring 169 tables and 244 figures

Key Trends in the Global Housing Market

• labor costs and material costs
• new or altered government incentives
• trends in interest rates
• the supply and demand gap on existing housing stock

Global construction of new housing is projected to expand 2.4% per year through 2029 to 60 million units, driven by:

• new housing formation in countries with large population shares in the 18-24 year-old range
• programs like Pradhan Mantri Awas Yojana in India to boost the construction of affordable housing units

• rural-to-urban migration in lower-income countries

• a recovery in housing construction in Western Europe, where a number of countries saw sharp contraction in housing activity in 2024

While Global New Housing Will Grow, Weak Performances Are Expected for US & China

Despite the general global trend of new housing growth, two of the largest housing markets in the world – China and the US – are expected to see weaker performances:

• China will see construction rise only marginally through 2029, beset by declining population, central government measures to curb excessive borrowing among real estate developers, and the overhang of large numbers of vacant housing units constructed in the last decade, particularly in third- and fourth-tier cities

• In the US, completions of new housing units are expected to decline through 2029, measured against an inflated 2024 base, which saw a surge in construction of multifamily housing units.

Rural-to Urban Migration & Replacement of Substandard Housing Boosts Multifamily Units

Over the forecast period, multifamily housing construction is expected to outpace construction of single-family units due to primarily to continued rural-to-urban migration in lower-income countries in Africa and Asia. India alone will account for over 40% of multifamily units built globally, supported not only by urbanization and a growing population, but also by government efforts to build affordable housing for the urban poor. In general, many of the governments in these African and Asian countries have already or will institute programs designed to reduce the share of the population that dwells in substandard housing units, often constructed informally out of repurposed materials.

Housing Stock

Regional Outlook

The global housing stock is forecast to increase 1.2% per year to 2.6 billion units in 2029, growing at the same rate as the number of households. Gains in the housing stock will be driven by:

• new household formation and increased shelter needs

• increasing income levels, allowing families living in shared quarters to move into their own homes and more affluent households to afford the purchase of a secondary residence

• migration from rural areas to urban centers

• construction of subsidized, or social, housing for low-income households to help alleviate shortages of affordable dwellings

In many countries, rural-to-urban migration will stimulate growth in new housing beyond that required by population increases. Such internal population flows will test the ability of government planning agencies to respond to the increased need for urban housing. As a result, some housing needs will continue to be met by the construction of substandard, informal housing, or slums – often on land to which the dweller has unclear or no legal title.

In addition, a substantial amount of vacant housing units (built because of speculation and asset-formation) has led to the creation of “ghost cities” in countries such as China, which could discourage future property development. Governments must find a way to utilize these unoccupied housing units, especially as significant portions of their populations continue to live in informal housing and in poor living conditions.

Renovation and expansion of the existing housing stock boost residential construction expenditures but do not contribute to growth in the number of new homes. Renovation activity represents a large share of residential construction spending in industrialized countries, where:

• populations are generally either growing slowly or declining

• the need for an increased number of housing units is less pressing

The materials used in housing construction, as well as the quality of construction, vary across countries:

• Some dwellings are constructed of less durable materials such as grass or cardboard, particularly in urban slums or rural areas of developing countries. Roofing and siding materials may be obtained by reclaiming used products such as corrugated metal panels or wooden crates.

• Dwellings constructed in the formal sector are more likely to use new, durable building materials intended for the purpose, such as building boards, bricks, and asphaltic or tile roofing materials.

Developing countries in the Africa/Mideast and Asia/Pacific regions are expected to post the greatest absolute increases in population and new households. As a result, these countries will account for a significant portion of global new housing construction, boosting the size of their housing stock:

• The Africa/Mideast region is anticipated to see the most rapid growth in the size of its housing stock of any region, as countries in the area continue to industrialize and see standards of living improve.

• India – the world’s most populous country – will see the healthy increases in new housing construction above the average in the Asia/Pacific region, with Malaysia, Pakistan, and the Philippines also registering new housing construction gains faster than the global average.

Types of Housing (Single-Family & Multifamily)