What Transformation Has the Affordable Housing Market Undergone?
The affordable housing market has seen considerable growth due to a variety of factors.
•In recent times, there has been a significant expansion in the affordable housing market. It is projected to rise from $57.14 billion in 2024 to $60.42 billion in 2025, showing a compound annual growth rate (CAGR) of 5.7%.
The surge in growth rate during the historical period can be credited to governmental subsidies and schemes, reduced interest rates, population upsurge, urban transitions, and local development strategies.
How Will The Affordable Housing Market Size Evolve In The Foreseeable Future?
The affordable housing market is expected to maintain its strong growth trajectory in upcoming years.
• The size of the affordable housing market is set to witness significant expansion in the near future, reaching a worth of $75.95 billion by 2029 at a compound annual growth rate (CAGR) of 5.9%.
This spike in growth during the projected period can be linked to several factors including policy reforms, climate resilience, adaptable financing models, emphasis on inclusionary zoning, and housing sponsored by employers. In the same forecast period, key trends to observe include collaborations between the public and private sectors, embracement of technology and innovation, emergence of tiny homes and micro-apartments, intelligent and sustainable affordable housing solutions, and the rise in mixed-use developments.
What Are The Essential Drivers Behind The Growth Of The Affordable Housing Market?
The ready accessibility of home loans plays a crucial role in promoting the expansion of the affordable housing market in the future. In essence, home loans are sums borrowed by individuals from financial establishments, such as housing finance companies, for the purpose of constructing a house, refurbishing an existing one, or acquiring a new or preowned house. They provide monetary assistance to individuals or families, thereby enabling them to buy or build homes at an affordable rate, thus promoting homeownership and tackling housing affordability problems. For example, in May 2023, as per the Federal Reserve Bank of New York, an American bank affiliated with the Federal Reserve charged with executing monetary policy, total household debt witnessed an increase of $148 billion (0.9%), reaching $17.05 trillion in the initial quarter of 2023, with its current balances standing at $2.9 trillion. Hence, the ready accessibility of home loans is propelling the expansion of the affordable housing market.
How Is The Global Affordable Housing Market Divided Into Key Segments?
The affordable housing market covered in this report is segmented –
1) By Providers: Private Builders, Government, Public-Private Partnership
2) By Size Of Unit: Up To 400 square Feet, 400-800 Square Feet, Above 800 Square Feet
3) By Location: Urban, Rural
4) By Income Categories: Economically Weaker Sections (EWS), Middle Income Group (MIG), Lower Income Group (LIG)
5) By Population: Slum Population, Non-slum population
Subsegments:
1) By Private Builders: Large Real Estate Developers, Small And Medium Enterprises (SMEs), Non-Profit Housing Developers
2) By Government: National Housing Authorities, Local Government Housing Agencies, Social Housing Programs
3) By Public-Private Partnership (PPP): Joint Ventures Between Government And Private Developers, Cooperative Housing Initiatives, Community Development Projects
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What Trends Are Reshaping The Future Of The Affordable Housing Market?
The rise in technological innovations is a significant trend making waves in the cost-effective housing market. Many leading corporations in this market prioritize the creation of groundbreaking and technologically sophisticated affordable housing options to solidify their footprint in the market. A prime example is how AppFolio Inc., a real estate management solutions firm based in the U.S., launched a range of affordable housing strategies, heavily reliant on AI technologies in June 2023. The firm is planning to integrate these cutting-edge AI functionalities into affordable housing solutions to equip property managers better to improve resident experiences. This novel, affordable housing solution is formulated to cater to the specific needs of those clients who manage affordable housing properties or units as part of their portfolios. It streamlines compliance management, accelerates procedures, and combines accounting operations for both conventional and affordable housing units into one unified platform.
Who Are the Key Players in the Affordable Housing Market?
Major companies operating in the affordable housing market include:
• Skanska AB
• The Related Group
• L&T Construction
• Volunteers of America
• Shapoorji Pallonji & Company Private Limited
• The Beacon Communities LLC
• McCormack Baron Salazar
• Prestige Group
• The Michaels Organization
• Amrapali Group
• Pinnacle Housing Group
• National Church Residences
• BRIDGE Housing Corporation
• Shriram Properties Ltd.
• Dominium
• Herman & Kittle Properties Inc.
• Jonathan Rose Companies LLC
• Provident Housing Limited
• The Community Builders Inc.
• AHC Inc.
• TWG Development
• Tata Realty And Infrastructure Limited
• The Richman Group
• LDG Development LLC
• Signature Global Limited
• NRP Group
• Dantes Partners
• XRBIA Developers Limited
• Mercy Housing Inc.
What are the Regional Insights into the Affordable Housing Market?
North America was the largest region in the affordable housing market in 2024. The regions covered in the affordable housing market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa
