The average construction cost of a single-family home in the United States was about ******* U.S. dollars in 2024, about ****** U.S. dollars more expensive than in 2022. The source also adds that interior finishes – which includes insulation, flooring, and appliances – accounted for the largest share of costs at ** percent. U.S. housing construction slows Construction work was underway on over 1,000 single-family housing units in the United States in 2024. This number increased year-on-year between 2011 and 2021, followed by a notable decline in the next two years. Despite this trend, the industry experts are optimistic about construction levels picking up until 2026. The median size of a new single-family home has also shrunk. In 2023, the average home had approximately ***** square feet of floor space, about *** square feet less than in 2015. How many homes are sold each year in the United States? Less than ************ homes were sold in the United States in 2023, the majority of which were existing home sales. The median sales price of an existing single-family home was ******* U.S. dollars in that year, a figure that has risen steadily since 2011. Those in the market for a newly constructed single-family home will have to pay more, with the median sales price at ******* U.S. dollars in 2022.

Romania Construction Cost Index: 2021=100: NACE 2: ow Buildings: Residential data was reported at 145.500 2021=100 in Feb 2025. This records an increase from the previous number of 143.600 2021=100 for Jan 2025. Romania Construction Cost Index: 2021=100: NACE 2: ow Buildings: Residential data is updated monthly, averaging 66.400 2021=100 from Jan 2005 (Median) to Feb 2025, with 242 observations. The data reached an all-time high of 145.500 2021=100 in Feb 2025 and a record low of 38.100 2021=100 in Feb 2005. Romania Construction Cost Index: 2021=100: NACE 2: ow Buildings: Residential data remains active status in CEIC and is reported by National Institute of Statistics. The data is categorized under Global Database’s Romania – Table RO.EA008: Construction Cost Index: 2021=100.

Building materials made of steel, copper and other metals had some of the highest price growth rates in the U.S. in the first half of 2025 in comparison to the previous year. The growth rate of the cost of several construction materials was slightly lower than in late 2024. It is important to note, though, that the figures provided are Producer Price Indices, which cover production within the United States, but do not include imports or tariffs. This might matter for lumber, as Canada's wood production is normally large enough that the U.S. can import it from its neighboring country. Construction material prices in the United Kingdom Similarly to these trends in the U.S., at that time the price growth rate of construction materials in the UK were generally lower 2024 than in 2023. Nevertheless, the cost of some construction materials in the UK still rose that year, with several of those items reaching price growth rates of over **** percent. Considering that those materials make up a very big share of the costs incurred for a construction project, those developments may also have affected the average construction output price in the UK. Construction material shortages during the COVID-19 pandemic During the first years of the COVID-19 pandemic, there often were supply problems and material shortages, which created instability in the construction market. According to a survey among construction contractors, the construction materials most affected by shortages in the U.S. during most of 2021 were steel and lumber. This was also a problem on the other side of the Atlantic: The share of building construction companies experiencing shortages in Germany soared between March and June 2021, staying at high levels for over a year. Meanwhile, the shortage of material or equipment was one of the main factors limiting the building activity in France in June 2022.

************************* residential greenfield construction costs were all **** percent higher in 2024 compared to 2023. The general trend in greenfield construction costs has seen lower growth rates since 2021.

According to Cognitive Market Research, the Residential Construction Market Size was USD XX Million in 2024 and is set to achieve a market size of USD XX Million by the end of 2033, growing at a CAGR of XX% from 2025 to 2033.

Asia-Pacific held largest share of xx% in the year 2024 
Europe held share of xx% in the year 2024 
North America held significant share of xx% in the year 2024 
South America held significant share of xx% in the year 2024
Middle East and Africa held significant share of xx% in the year 2024 

MARKET DYNAMICS: Residential Construction Market

KEY DRIVERS

The increasing global population is driving the need for the residential construction market.

The worldwide population has been consistently rising and is expected to keep expanding over the upcoming years. As per the United Nations, the global population is projected to hit 8 billion in 2024 and is projected to reach a maximum of approximately 10 billion. The effects of this population increase are substantial, influencing multiple sectors such as housing and healthcare. With the rise in population, there is a related increase in the demand for residential housing, requiring careful planning and resource distribution to meet the escalating needs. To meet the demand, both government entities and private sector firms are elevating their construction activities. Governments in various nations, like India, are also focusing on the advancement of rural regions. These are the main factors that have been driving the expansion of the residential construction market. Moreover, the younger population is prevalent in the age demographics of emerging markets like India, Japan, and China. The younger generation is more drawn to newly designed homes than to older buildings. The need for increased living space during and following the coronavirus pandemic resulted in heightened demand for housing, with a significant flow of new immigrants driving household formation. This is yet another element that fuels the expansion of the residential building sector. Thus, the rising global population is fuelling the demand for the residential construction sector.

(Source:https://population.un.org/wpp/assets/Files/WPP2024_Summary-of-Results.pdf

https://www.cbo.gov/publication/60727)

Restraints

Volatility of raw material prices, such as steel, concrete, is hindering the growth of the residential construction market.

The expansion of the residential building market is increasingly hindered by fluctuations in raw material costs, especially for crucial materials like aluminium, steel, concrete, and softwood lumber. With the increasing prices of these construction materials, housing affordability suffers, creating greater difficulties for both developers and homebuyers.

This increase in prices is mainly influenced by the fundamental economic concept of supply and demand. In peak construction periods, the demand for building supplies increases significantly, yet availability frequently stays limited because of worldwide shortages and disruptions. These constraints inherently drive prices upward, worsening the problem. Adding to the issue are uncertainties in the production process and erratic timelines for material arrivals, which hinder builders from finishing projects on time. Widespread inflationary pressures in the overall economy further increase expenses, as the overall increase in prices for products and services inevitably affects construction materials.

Furthermore, numerous raw materials employed in home construction are commodities traded worldwide. This makes the market more vulnerable to additional volatility resulting from geopolitical conflicts, trade disagreements, and alterations in global trade regulations, all of which can interfere with supply chains and cause price surges. As reported by the Associated Builders and Contractors, construction material prices increased by 1.3% in January 2023 alone. This figure is not only 1.3% above December 2022, but it also indicates a 4.9% rise from the prior year. Even though this is the least annual rise since January 2021, it highlights the ongoing upward trend in material expenses.

In conclusion, the fluctuations in raw material prices caused by supply-demand disparities, inflation, and global market disturbances are greatly obstructing the expansion of the residential construction sector by increasing expenses ...

Construction Output Price Indices (OPIs) from January 2014 to September 2025, UK. Summary

Colombia Construction Cost Index: Bldg: Residential: Manizales data was reported at 125.800 Dec2021=100 in Oct 2025. This records a decrease from the previous number of 126.460 Dec2021=100 for Sep 2025. Colombia Construction Cost Index: Bldg: Residential: Manizales data is updated monthly, averaging 117.620 Dec2021=100 from Jan 2022 (Median) to Oct 2025, with 46 observations. The data reached an all-time high of 127.320 Dec2021=100 in Apr 2025 and a record low of 101.768 Dec2021=100 in Jan 2022. Colombia Construction Cost Index: Bldg: Residential: Manizales data remains active status in CEIC and is reported by National Administrative Department of Statistics. The data is categorized under Global Database’s Colombia – Table CO.EA: Construction Cost Index: Buildings: Dec2021=100.

Colombia Construction Cost Index: Housing: Single Family Houses: Medellin data was reported at 287.500 Dec1999=100 in Dec 2021. This records an increase from the previous number of 287.370 Dec1999=100 for Nov 2021. Colombia Construction Cost Index: Housing: Single Family Houses: Medellin data is updated monthly, averaging 201.070 Dec1999=100 from Jan 2006 (Median) to Dec 2021, with 192 observations. The data reached an all-time high of 287.500 Dec1999=100 in Dec 2021 and a record low of 151.340 Dec1999=100 in Jan 2006. Colombia Construction Cost Index: Housing: Single Family Houses: Medellin data remains active status in CEIC and is reported by National Administrative Department of Statistics. The data is categorized under Global Database’s Colombia – Table CO.EA013: Construction Cost Index: Housing: Dec1999=100.

Colombia Construction Cost Index: Housing: Armenia data was reported at 306.690 Dec1999=100 in Dec 2021. This records an increase from the previous number of 306.120 Dec1999=100 for Nov 2021. Colombia Construction Cost Index: Housing: Armenia data is updated monthly, averaging 210.370 Dec1999=100 from Jan 2005 (Median) to Dec 2021, with 204 observations. The data reached an all-time high of 306.690 Dec1999=100 in Dec 2021 and a record low of 155.700 Dec1999=100 in Jan 2005. Colombia Construction Cost Index: Housing: Armenia data remains active status in CEIC and is reported by National Administrative Department of Statistics. The data is categorized under Global Database’s Colombia – Table CO.EA013: Construction Cost Index: Housing: Dec1999=100.

In the first quarter of 2025, San Francisco, Chicago, New York, and Honolulu were some of the U.S. cities with the highest housing construction costs. Meanwhile, Phoenix had one of the lowest construction costs for high-end multifamily homes at *** U.S. dollars per square foot and Las Vegas for single-family homes between *** and *** U.S. dollars per square foot. Construction cost disparities As seen here, the construction cost for a high-end multi-family home in San Francisco in the first quarter of 2024 was over ***** more expensive than in Phoenix. Meanwhile, there were also great differences in the cost of building a single-family house in New York and in Portland or Seattle. Some factors that may cause these disparities are the construction materials, installation, and composite costs, differing land values, wages, etc. For example, although the price of construction materials in the U.S. was rising at a slower level than in 2022 and 2023, several materials that are essential in most construction projects had growth rates of over **** percent in 2024. Growing industry revenue Despite the economic uncertainty and other challenges, the size of the private construction market in the U.S. rose during the past years. It is important to consider that supply and demand for housing influences the revenue of this segment of the construction market. On the supply side, single-family home construction fell in 2023, but it is expected to rise in 2024 and 2025. On the demand side, some of the U.S. metropolitan areas with the highest sale prices of single-family homes were located in California, with San Jose-Sunnyvale-Santa Clara at the top of the ranking.

During the observed period, the data Portugal's new housing construction cost index reached nearly *** points by January 2025, reflecting a significant increase from the base year of 2021. This overall rise in construction costs includes increases in the indexes of both materials and, especially, labor cost in the construction sector. Trends in residential construction The proportion of one-dwelling residential construction in Portugal has grown steadily since 2017, accounting for ** percent of new builds in 2023. This trend coincides with a decrease in mostly non-residential construction, which fell to its lowest share of approximately ** percent in the same year. The northern region of Portugal has emerged as a hotspot for new housing, completing over ****** new dwellings for family housing in 2023, while Greater Lisbon saw a preference for three-bedroom dwellings in new constructions. Housing market dynamics Despite the growing construction costs, Portugal's residential property sector is performing confidently, which is reflected in rising residential construction permits. The number of permits issued for residential property construction, which had declined sharply from nearly ****** in 2007 to less than ****** in 2020, rebounded to almost ****** in 2023, an uptick that does not match Portugal’s severe housing problems.

Myanmar Completed Residential Building: Construction Cost: Public data was reported at 253,722.800 MMK mn in 2021. This records an increase from the previous number of 136,646.700 MMK mn for 2020. Myanmar Completed Residential Building: Construction Cost: Public data is updated yearly, averaging 136,646.700 MMK mn from Sep 2019 (Median) to 2021, with 3 observations. The data reached an all-time high of 253,722.800 MMK mn in 2021 and a record low of 88,500.900 MMK mn in 2019. Myanmar Completed Residential Building: Construction Cost: Public data remains active status in CEIC and is reported by Ministry of Planning and Finance. The data is categorized under Global Database’s Myanmar – Table MM.EA001: Building Construction Completed.

Building contractors and developers depend on various socio-economic factors, including property values, underlying sentiment in the housing market, the degree of optimism among downstream businesses and credit conditions. All of these drivers typically track in line with economic sentiment, with recent economic shocks spurring a difficult period for building contractors and developers. Nonetheless, the enduring need for building services, particularly to tackle housing shortages across the continent, ensures a strong foundation of work. Revenue is forecast to grow at a compound annual rate of 2.3% to reach €1.3 trillion over the five years through 2025. Operational and supply chain disruption caused by the pandemic reversed the fortunes of building contractors and developers in 2020, as on-site activity tumbled and downstream clients either cancelled, froze or scaled back investment plans. Aided by the release of pent-up demand and supportive government policy, building construction output rebounded in 2021. Excess demand for key raw materials led to extended lead times during this period, while input costs recorded a further surge as a result of the effects of rapidly climbing energy prices following Russia’s invasion of Ukraine. Soaring construction costs and the impact of interest rate hikes on both the housing market and investor sentiment led to a renewed slowdown in building construction activity across the continent. However, falling inflation and the start of an interest rate cutting cycle have spurred signs of a recovery in new work volumes, supporting anticipated revenue growth of 2.3% in 2025. Revenue is forecast to increase at a compound annual rate of 6.7% to €1.7 trillion over the five years through 2030. Activity is set to remain sluggish in the medium term, as weak economic growth and uncertainty surrounding the impact of the volatile global tariff environment on inflation and borrowing costs continue to weigh on investor sentiment. Contractors and developers will increasingly rely on public sector support, including measures to boost the supply of new housing, as countries seek to tackle severe housing shortages. Meanwhile, the introduction of more stringent sustainability requirements will drive demand for energy retrofits.

Germany Construction Cost: Estimated: Residential (RS) data was reported at 4,230,140.000 EUR th in Feb 2025. This records a decrease from the previous number of 4,313,129.000 EUR th for Jan 2025. Germany Construction Cost: Estimated: Residential (RS) data is updated monthly, averaging 3,960,678.500 EUR th from Jan 2003 (Median) to Feb 2025, with 266 observations. The data reached an all-time high of 8,132,106.000 EUR th in Mar 2021 and a record low of 1,768,777.000 EUR th in Feb 2009. Germany Construction Cost: Estimated: Residential (RS) data remains active status in CEIC and is reported by Statistisches Bundesamt. The data is categorized under Global Database’s Germany – Table DE.EA001: Building Permits Granted.

The size of the Malaysia Construction Market was valued at USD 16 Billion in 2023 and is projected to reach USD 23.43 Billion by 2032, with an expected CAGR of 5.6% during the forecast period. Recent developments include: April 2021: The Tetley Harris Food Group, a division of Tata Consumers Product, has announced that the US-based Harris Tea Company has bought all of its shares. The organization wants to offer integrated end-to-end services to its clients., January 2021: Habib Bakshi, CEO of SkyDiamond Elite, purchased the Construction shop, which sold kits for making homemade brews. Additionally, the company uses a special combination of materials to prepare the product. With consumers' increasing health consciousness, the company plans to expand its business via digital marketing and assist customers in making cost-effective lifestyle changes.. Notable trends are: Growing residential construction is driving the market growth.

The average price per square foot of floor space in new single-family housing in the United States decreased after the great financial crisis, followed by several years of stagnation. Since 2012, the price has continuously risen, hitting ****** U.S. dollars per square foot in 2024. In 2024, the average sales price of a new home exceeded ******* U.S. dollars. Development of house sales in the U.S. One of the reasons for rising property prices is the gradual growth of house sales between 2011 and 2020. This period was marked by the gradual recovery following the subprime mortgage crisis and a growing housing sentiment. Another significant factor for the housing demand was the growing number of new household formations each year. Despite this trend, housing transactions plummeted in 2021, amid soaring prices and borrowing costs. In 2021, the average construction cost for single-family housing rose by nearly ** percent year-on-year, and in 2022, the increase was even higher, at close to ** percent. Financing a house purchase Mortgage interest rates in the U.S. rose dramatically in 2022 and remained elevated until 2024. In 2020, a homebuyer could lock in a 30-year fixed interest rate of under ***** percent, whereas in 2024, the average rate for the same mortgage type was more than twice higher. That has led to a decline in homebuyer sentiment, and an increasing share of the population pessimistic about buying a home in the current market.

Building contractors and developers depend on various socio-economic factors, including property values, underlying sentiment in the housing market, the degree of optimism among downstream businesses and credit conditions. All of these drivers typically track in line with economic sentiment, with recent economic shocks spurring a difficult period for building contractors and developers. Nonetheless, the enduring need for building services, particularly to tackle housing shortages across the continent, ensures a strong foundation of work. Revenue is forecast to grow at a compound annual rate of 2.3% to reach €1.3 trillion over the five years through 2025. Operational and supply chain disruption caused by the pandemic reversed the fortunes of building contractors and developers in 2020, as on-site activity tumbled and downstream clients either cancelled, froze or scaled back investment plans. Aided by the release of pent-up demand and supportive government policy, building construction output rebounded in 2021. Excess demand for key raw materials led to extended lead times during this period, while input costs recorded a further surge as a result of the effects of rapidly climbing energy prices following Russia’s invasion of Ukraine. Soaring construction costs and the impact of interest rate hikes on both the housing market and investor sentiment led to a renewed slowdown in building construction activity across the continent. However, falling inflation and the start of an interest rate cutting cycle have spurred signs of a recovery in new work volumes, supporting anticipated revenue growth of 2.3% in 2025. Revenue is forecast to increase at a compound annual rate of 6.7% to €1.7 trillion over the five years through 2030. Activity is set to remain sluggish in the medium term, as weak economic growth and uncertainty surrounding the impact of the volatile global tariff environment on inflation and borrowing costs continue to weigh on investor sentiment. Contractors and developers will increasingly rely on public sector support, including measures to boost the supply of new housing, as countries seek to tackle severe housing shortages. Meanwhile, the introduction of more stringent sustainability requirements will drive demand for energy retrofits.

Colombia Construction Cost Index: Housing: Bogota data was reported at 263.720 Dec1999=100 in Dec 2021. This records a decrease from the previous number of 263.810 Dec1999=100 for Nov 2021. Colombia Construction Cost Index: Housing: Bogota data is updated monthly, averaging 199.995 Dec1999=100 from Jan 2005 (Median) to Dec 2021, with 204 observations. The data reached an all-time high of 263.810 Dec1999=100 in Nov 2021 and a record low of 149.900 Dec1999=100 in Jan 2005. Colombia Construction Cost Index: Housing: Bogota data remains active status in CEIC and is reported by National Administrative Department of Statistics. The data is categorized under Global Database’s Colombia – Table CO.EA013: Construction Cost Index: Housing: Dec1999=100.

Building contractors and developers depend on various socio-economic factors, including property values, underlying sentiment in the housing market, the degree of optimism among downstream businesses and credit conditions. All of these drivers typically track in line with economic sentiment, with recent economic shocks spurring a difficult period for building contractors and developers. Nonetheless, the enduring need for building services, particularly to tackle housing shortages across the continent, ensures a strong foundation of work. Revenue is forecast to grow at a compound annual rate of 2.3% to reach €1.3 trillion over the five years through 2025. Operational and supply chain disruption caused by the pandemic reversed the fortunes of building contractors and developers in 2020, as on-site activity tumbled and downstream clients either cancelled, froze or scaled back investment plans. Aided by the release of pent-up demand and supportive government policy, building construction output rebounded in 2021. Excess demand for key raw materials led to extended lead times during this period, while input costs recorded a further surge as a result of the effects of rapidly climbing energy prices following Russia’s invasion of Ukraine. Soaring construction costs and the impact of interest rate hikes on both the housing market and investor sentiment led to a renewed slowdown in building construction activity across the continent. However, falling inflation and the start of an interest rate cutting cycle have spurred signs of a recovery in new work volumes, supporting anticipated revenue growth of 2.3% in 2025. Revenue is forecast to increase at a compound annual rate of 6.7% to €1.7 trillion over the five years through 2030. Activity is set to remain sluggish in the medium term, as weak economic growth and uncertainty surrounding the impact of the volatile global tariff environment on inflation and borrowing costs continue to weigh on investor sentiment. Contractors and developers will increasingly rely on public sector support, including measures to boost the supply of new housing, as countries seek to tackle severe housing shortages. Meanwhile, the introduction of more stringent sustainability requirements will drive demand for energy retrofits.

Colombia Construction Cost Index: Housing: Neiva data was reported at 247.910 Dec1999=100 in Dec 2021. This records an increase from the previous number of 247.470 Dec1999=100 for Nov 2021. Colombia Construction Cost Index: Housing: Neiva data is updated monthly, averaging 179.960 Dec1999=100 from Jan 2005 (Median) to Dec 2021, with 204 observations. The data reached an all-time high of 247.910 Dec1999=100 in Dec 2021 and a record low of 138.100 Dec1999=100 in Feb 2005. Colombia Construction Cost Index: Housing: Neiva data remains active status in CEIC and is reported by National Administrative Department of Statistics. The data is categorized under Global Database’s Colombia – Table CO.EA013: Construction Cost Index: Housing: Dec1999=100.