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Real Estate Products Market Size, Share, & Trends Analysis Report (2023 – 2030)
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Report Overview
The global real estate market was valued at USD 8.2 trillion in 2021 and is anticipated to expand at a CAGR of 8.1% from 2022 to 2029. Rapid urbanization and growing disposable income are the major factors driving the market. The real estate sector has become an attractive investment option due to the low interest rate environment and the increasing demand from the retail, industrial, and office sectors.
The rising demand for residential properties due to the increasing population, urbanization, and affordability of properties have been propelling the growth of the real estate market. The increasing demand for residential properties in the wake of the COVID-19 pandemic has resulted in an increase in the number of transactions. This has resulted in an increase in the average price of residential properties.
Furthermore, the introduction of new technologies such as artificial intelligence (AI) and Internet of Things (IoT) is expected to revolutionize the real estate industry. These technologies are expected to enable real estate agents and developers to create more efficient, streamlined processes. In addition, blockchain technology is being used to enable secure and transparent transactions in the real estate market.
The increasing demand for green and sustainable buildings is also driving the growth of the real estate market. Governments across the globe are encouraging the adoption of green technologies in the construction of buildings. This is expected to reduce the carbon footprint and boost the growth of the real estate market.
The increasing demand for commercial properties from the corporate sector is also driving the growth of the real estate market. This is mainly due to the requirement of commercial properties for operational purposes. The increasing number of new businesses and the expansion of existing ones are driving the demand for commercial real estate. Moreover, the introduction of new business models such as coworking spaces is expected to further boost the growth of the market.
Product Insights
The residential segment led the market and accounted for a share of around 51.1% in 2022. Factors such as rising urbanization, increasing disposable incomes, and the increasing preference for nuclear families are driving the growth of the residential real estate market. According to an article published by Forbes in October 2019, the demand for housing has increased due to the rising population and urbanization, along with the growing demand for luxurious housing. Furthermore, increasing government initiatives in developing smart cities are projected to fuel the demand for residential properties across the globe.
The commercial segment is anticipated to expand at the fastest CAGR of 8.2% over the forecast period. Increasing demand for office space and commercial real estate is attributed to the increasing trend of corporate expansion in emerging markets. According to an article published by Statista in August 2020, the value of global commercial real estate transactions was estimated to be around USD 1.2 trillion in 2019. In addition, factors such as the rise in e-commerce activities, increasing demand for logistics and warehousing, and growing investments in the hospitality sector are expected to drive the demand for commercial real estate in the coming years.
Distribution Channel Insights
The real estate products market is dominated by the offline channel segment. This segment captured a major market share of over 56.3% in 2022. The offline channel includes traditional retail stores, real estate brokers, individual agents, and franchises. These channels are popular among customers as they provide a personalized experience, enabling them to see and touch the products before purchase. Additionally, offline stores offer the benefit of immediate product delivery and the ability to negotiate prices.
The online channel segment is anticipated to expand at the highest CAGR of 11.6% over the forecast period. The increasing use of internet technology for real estate transactions and the rising trend of online property search are driving the growth of the online channel segment. Additionally, the availability of a wide range of real estate products on e-commerce websites, such as Zillow, Redfin, and Trulia, is expected to further drive the growth of the segment. Moreover, e-commerce websites offer discounts and attractive deals on real estate products, which is likely to increase their popularity among customers.
Type Insights
The residential segment accounted for the largest revenue share of 75.5% in the year 2022. The rising population has increased the demand for residential housing across the world. The growth of the construction industry, especially in developing countries, has also contributed to the growth of the residential segment. Also, the increasing trend of smart homes and increased investments in the construction industry have further accelerated the demand for residential real estate products.
The commercial segment is anticipated to expand at the highest CAGR of 8.4% over the forecast period. The commercial sector has seen a surge in investments in recent years. The increasing demand for leisure, entertainment, and hospitality activities such as cafes and restaurants has increased the demand for commercial real estate products. Also, the growing demand for corporate offices and retail space is driving the market for commercial real estate products.
Regional Insights
Europe accounted for the largest revenue share of over 30.0% in 2022. This can be attributed to the increasing demand for luxury and smart real estate products in the region. The region is also home to the presence of a large number of high-net-worth individuals, who are willing to invest in luxurious real estate projects. Additionally, the European Union has implemented laws to promote energy-efficient real estate projects. For instance, in October 2021, the European Union adopted the Energy Performance of Buildings Directive (EPBD), which requires all new buildings to be nearly zero-energy buildings from 2021 onwards.
The Asia Pacific region is expected to witness the fastest growth in the coming years. The growing population, increasing disposable income, and rapid urbanization in countries such as India, China, and Japan, are the major factors driving the market growth in the region. The rising demand for residential and commercial buildings is the major factor behind this growth. For instance, in March 2022, a Chinese real estate developer, Evergrande Group, launched a premium residential project in Shanghai, which comprises of more than 1,000 villas.
Financial Projections
In this part of the real estate products business plan we will provide a detailed breakdown of all income and expense categories of the business. These forecasts include cash flow projections and capital requirements for your real estate products. Usually, these projections are drafted for a 5-year period.
Revenue Assumptions
The main source of revenues for a real estate products business comes from sales of products, commissions from brokers, and fees from services such as property management, consulting, and advising services. Here you will find a list with a description of each of them and other possible sources of profit such as rentals, advertising, and sale of real estate-related products.
Projecting Expenses
In this section, all the regular expenses related to keeping the real estate products business running will be described. The list of operating expenses includes office rent, administrative staff wages, marketing and advertising costs, insurance policies, utilities, and others.
Key companies & market share insights
Some of the key companies operating in the real estate market are increasingly focusing on product launches and expansion of the distribution channel to gain prominent visibility among consumers. Some of the initiatives are:
– In June 2022, Zillow Group launched Zillow Offers, a new service that allows homeowners to quickly and easily sell their homes to the company.
– In August 2022, Keller Williams launched Keller Williams Realty, a full-service real estate brokerage offering services to buyers and sellers.
– In October 2022, Realogy Holdings Corp. launched NRT LLC, a real estate brokerage offering services for luxury buyers and sellers.
Some of the prominent players in the real estate market include:
– Zillow Group
– Keller Williams Realty
– Redfin
– Realogy Holdings Corp.
– Compass
– RE/MAX LLC
– HomeServices of America, Inc.
– Century 21 Real Estate
– Better Homes and Gardens Real Estate
– Sotheby’s International Realty
Global Real Estate Market Segmentation
This report forecasts growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global real estate products market based on product, distribution channel, type, and region:
1. Product Outlook (Revenue, USD Million, 2017 – 2030)
– Residential
– Commercial
– Industrial
– Land
2. Distribution Channel Outlook (Revenue, USD Million, 2017 – 2030)
– Direct Sales
– Online
– Others
3. Type Outlook (Revenue, USD Million, 2017 – 2030)
– New Construction
– Resale
4. Regional Outlook (Revenue, USD Million, 2017 – 2030)
– North America
– Europe
– Asia Pacific
– Central & South America
– Middle East & Africa
Frequently Asked Questions
[Q]: What are the Factors Driving the Growth of the Real Estate Products Market?
[A]: The key drivers of the real estate products market include the increasing urbanization and industrialization, the increasing disposable income of consumers, the increasing demand for affordable housing, and the increasing adoption of smart and connected technology in real estate. Additionally, government initiatives to boost affordable housing, as well as the rising demand for tourism, are expected to drive market growth.
[Q]: What are the Major Trends in the Real Estate Products Market?
[A]: The major trends in the real estate products market include the increasing adoption of technology, the increasing demand for green and sustainable buildings, the increasing demand for smart buildings, and the increasing demand for affordable housing. Additionally, the rise of alternative asset classes such as coworking spaces, Airbnb, and short-term rentals are expected to drive market growth in the near future.
[Q]: Who are the Key Players in the Real Estate Products Market?
[A]: Key players in the real estate products market include CBRE Group, Inc., Colliers International Group Inc., Jones Lang LaSalle Incorporated, Cushman & Wakefield, Inc., and JLL.
[Q]: What Region Offers the Largest Opportunity for Sales of Real Estate Products?
[A]: The Asia Pacific region is expected to be the largest market for real estate products, with an absolute dollar opportunity of $84.9 B (USD). This is due to the increasing urbanization and industrialization, the rising population, and the increasing demand for affordable housing.
[Q]: What are the Growth Strategies Adopted by the Major Players in the Real Estate Products Market?
[A]: The major players are adopting strategies such as acquisitions, collaborations, partnerships, and product launches to gain a competitive edge in the market. Additionally, companies are investing heavily in research and development activities to enhance their product portfolio and gain a competitive edge.
Research Methodology
Impact Analytix employs a comprehensive and iterative research methodology focused on minimizing deviance in order to provide the most accurate estimates and forecasts possible. The company utilizes a combination of bottom-up and top-down approaches for segmenting and estimating quantitative aspects of the market. In Addition, a recurring theme prevalent across all our research reports is data triangulation which looks market from three different perspectives. Critical elements of the methodology employed for all our studies include:
Preliminary data mining
Raw market data is obtained and collated on a broad front. Data is continuously filtered to ensure that only validated and authenticated sources are considered. In addition, data is also mined from a host of reports in our repository, as well as a number of reputed paid databases. For a comprehensive understanding of the market, it is essential to understand the complete value chain and in order to facilitate this; we collect data from raw material suppliers, distributors as well as buyers.
Technical issues and trends are obtained from surveys, technical symposia, and trade journals. Technical data is also gathered from an intellectual property perspective, focusing on white space and freedom of movement. Industry dynamics with respect to drivers, restraints, and pricing trends are also gathered. As a result, the material developed contains a wide range of original data that is then further cross-validated and authenticated with published sources.
Statistical model
Our market estimates and forecasts are derived through simulation models. A unique model is created and customized for each study. Gathered information for market dynamics, technology landscape, application development, and pricing trends are fed into the model and analyzed simultaneously. These factors are studied on a comparative basis, and their impact over the forecast period is quantified with the help of correlation, regression, and time series analysis. Market forecasting is performed via a combination of economic tools, technological analysis, industry experience, and domain expertise.
Econometric models are generally used for short-term forecasting, while technological market models are used for long-term forecasting. These are based on an amalgamation of the technology landscape, regulatory frameworks, economic outlook, and business principles. A bottom-up approach to market estimation is preferred, with key regional markets analyzed as separate entities and integration of data to obtain global estimates. This is critical for a deep understanding of the industry as well as ensuring minimal errors. Some of the parameters considered for forecasting include:
Market drivers and restraints, along with their current and expected impact
Raw material scenario and supply v/s price trends
Regulatory scenario and expected developments
Current capacity and expected capacity additions up to 2030
We assign weights to these parameters and quantify their market impact using weighted average analysis, to derive an expected market growth rate.
Primary validation
This is the final step in estimating and forecasting our reports. Exhaustive primary interviews are conducted, face to face as well as over the phone to validate our findings and assumptions used to obtain them. Interviewees are approached from leading companies across the value chain including suppliers, technology providers, domain experts, and buyers so as to ensure a holistic and unbiased picture of the market. These interviews are conducted across the globe, with language barriers overcome with the aid of local staff and interpreters. Primary interviews not only help in data validation but also provide critical insights into the market, current business scenario, and future expectations and enhance the quality of our reports. All our estimates and forecast are verified through exhaustive primary research with Key Industry Participants (KIPs) which typically include:
Market-leading companies
Raw material suppliers
Product distributors
Buyers
The key objectives of primary research are as follows:
To validate our data in terms of accuracy and acceptability
To gain an insight into the current market and future expectations
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