Germany gradually becoming a country of prefabricated housesNew Study from Interconnection Available
In Germany, market value of prefabricated houses rose by 15,7% last year, which was not only the result of the construction boom. A new study from Interconnection Consulting shows that compared to the overall market, the demand for prefabricated houses rose beyond average, contributing to a rise in the prefabricated house quota (20,4%).
The trend is in favor of prefabricated houses
The trend towards prefabricated houses will continue in the future. By 2020 an average annual growth of 6,6% is expected for the industry. Over the next few years, according to the Interconnection study, prefab quota will continue to rise, and is expected to reach 21,0% by 2020. The sector profited by last years strong construction activity. The volume of prefabricated houses rose 9.4% last year.
Rising prices, growing market
Overall, the average price in the industry rose by 5,8% in 2016. The steady increase of prices made the competition with solid construction manufacturers more difficult. In consequence, manufacturers of prefabricated houses had to find new ways to appeal to the customer. "The greatest potential lies in the sale of prefabricated houses with an attractive plot of land," explains Neva Rukonic, author of the study. As a result, companies that sell prefabricated houses along with the plot are experiencing the greatest growth. In addition, row houses simplify the way to ones own house, a fact which is also reflected in the above-average growth for this segment. In 2016, the sales volume of row houses increased by 12,0%. However, the segment of detached one family houses (with a share of 83,0%) still claims the lions share in the prefabricated house industry.
Turn-key houses are gaining shares
Rural areas traditionally more oriented towards buying houses with lower building stage (floor covering or shell-finished), are starting to follow the example of cities where the share of turnkey houses is already over 75,0%. Overall in Germany, the share of turn-key houses is 35,9% - and the trend is rising. The share of shell-finished houses fell from 25,6% to 25,4% in 2016. This trend will continue in the future. Nevertheless, as Rukonic explains, shell-finished houses represent a very important market segment since these houses represent an attractive alternative, especially for financially weaker customer segments. The largest segment constitutes ready for floor-covered houses with a market share of 38,7%. The share of this segment is expected to remain stable in the upcoming years.
Rising market concentration
The market concentration of the top 10 players continued to grow in 2016, reaching a level of 37,8%. After market consolidation and restructuring of several companies, larger manufacturers in Germany were able to win over market shares. Deutsche Fertighaus Holding with its four brands (Massa, Allkauf, Okal and Ein Stein) is undisputedly the largest manufacturer. However, many companies were able to record sales growth, which will also be reflected in increases building completions in 2017.