Sustainable construction, now that the luster of trendiness has worn off, continues to make inroads as a remodeling market segment with serious growth potential. Findings to support this notion were released Thursday at the National Association of Home Builders' International Builders' Show in Orlando, in the form the results of McGraw-Hill Construction's new Green Home Builders and Remodelers Study. Green homes comprised 17% of the overall residential construction market in 2011 and are expected to grow to between 29% and 38% of the market by 2016, according to the study. This means that, by value, the growth will equal fully a five-fold increase, growing from $17 billion in 2011 to $87-$114 billion in 2016, based on the five-year forecast for overall residential construction.
According to the study, construction industry professionals report an even steeper increase in green home remodeling; 34% of remodelers expect to be doing mostly green work by 2016, a 150% increase over 2011 activity levels. Many home builders have shifted to the remodeling market due to the drastic drop in new home construction. In fact, 62% of the builders who do both new and remodeling work verified that the economy has increased their renovation work.
"The housing market is critical to the U.S. economy," said Harvey M. Bernstein, VP of Industry Insights and Alliances, McGraw-Hill Construction, "and the results of our study show that despite the drastic downturn in housing starts since 2008, green has grown significantly as a share of activity-- indicating that the green market is becoming an important part of our overall economic landscape."
The green home building study, produced by McGraw-Hill Construction in conjunction with the NAHB and Waste Management, is designed to provide key insights into market opportunities, backed by proprietary research surveys and the power of the Dodge database. The study reveals business benefits afforded by green building, such as a competitive marketing advantage: 46% of builders and remodelers find that "building green" makes it easier to market themselves in a down economy, and an overwhelming 71% of firms that are dedicated to green home building report the same.
McGraw-Hill Construction will continue analyzing the results of the Green Home Builders and Remodelers Study and release a printed report in April during the NAHB's National Green Building Conference and Expo in Nashville. More results from the study are available at the NAHB's website, and a fact sheet is available for purchase at McGraw-Hill Construction's site here.