Residential Real Estate Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

Global Residential Real Estate Market Trends and Insights

Rapid urbanisation & middle-class expansion

Emerging cities continue to add residents at rates that outpace historic averages. Every new urban migrant creates multiplier effects on household formation, with estimates suggesting that one arrival eventually stimulates demand for 1.3 housing units through indirect employment gains. Dubai illustrates the pattern: population surpassed 3.8 million in 2024 and 20% year-on-year apartment price growth followed^{[1]World Bank, “Global Economic Prospects June 2025,” World Bank, worldbank.org}. Similar pressure is evident across Latin America where GDP growth is rebounding, lifting disposable incomes and mortgage eligibility. In Asia-Pacific, vertical developments remain the most practical response to land scarcity, reinforcing sustained demand for condominiums. Supply lags are therefore structural rather than cyclical, underpinning long-run price resilience.

Institutional BTR & SFR capital inflows

As conventional office and retail yields compress, large asset managers pivot toward residential strategies. A USD 2.1 billion portfolio purchase by KKR covering 18 Class A multifamily communities signaled confidence in stable cash flows from sun-belt cities^{[2]KKR & Co. Inc., “KKR Acquires 18-Property Multifamily Portfolio for USD 2.1 Billion,” Investor Relations Press Release, kkr.com}. Build-to-rent platforms now command average monthly rents of USD 2,181 and continue to address an estimated 3.9 million-unit shortage in the United States. Europe mirrors the shift: residential assets captured 27% of total property investment by value in 2024, up from 20% three years earlier. Institutional bids compress yields but increase professionally managed stock, enhancing tenant experience and liquidity.

Wealth migration & second-home demand in tax-advantaged hubs

A projected 142,000 millionaires will relocate in 2025, led by inflows to the UAE, Singapore, and Portugal. Concentrated arrivals boost prime-property prices—Dubai luxury homes climbed 15% in 2024 while mid-tier units advanced 17%, a ripple effect from heightened spending capacity. Female investors, set to control USD 34 trillion by 2030, are an emerging force in these purchases, often prioritizing safe jurisdictions and high ESG standards. Secondary demand follows as service-sector staff seek nearby housing, tightening local supply even in middle-income segments.

Net-zero mandates driving green-retrofit premium

Cities are embedding decarbonisation into building codes. Boston requires all new structures above 20,000 sq ft to achieve net-zero emissions from 2025, while New York will phase out fossil-fuel equipment in low-rise builds by 2026^{[3]Boston Planning & Development Agency, “Zero Net Carbon Building Zoning Update 2025,” BPDA, bostonplans.org}. Developers incorporating high-efficiency HVAC and renewable energy recover added costs via premium rents and lower vacancy. Investor scrutiny is tightening too: 80% of Veris Residential’s multifamily portfolio now holds a green certification and the firm targets 50% cuts in Scope 1 and 2 emissions. Properties lacking certification risk accelerated obsolescence.

Global housing-affordability crisis

In Sydney median house values reached AUD 1.3 million in 2024, driving price-to-income ratios to 16.4 and leaving only 10% of listings affordable for median earners. Canada faces similar stress as mortgage delinquency crept to 0.20% nationally, doubling in Toronto. The United States still confronts a shortfall of up to 3.8 million homes; 45% of renters spend over 30% of income on housing^{[4]White House, “Housing Supply Action Plan Progress Report 2024,” The White House, whitehouse.gov}. Political pressure for subsidised supply is therefore mounting, yet fast-tracked approvals rarely keep pace with demand, capping absorption in entry-level brackets.

Rising policy rates & tighter credit standards

Although the Bank of Canada trimmed its policy rate to 3.25% in 2024, mortgage renewals remain over 200 bps above 2021 lows, pressuring household cash flow^{[5]Bank of Canada, “Monetary Policy Report Q4 2024,” Bank of Canada, bankofcanada.ca}. Eurozone prices pivoted from 7% growth in 2022 to a 1% decline in 2023 as financing costs spiked. US mortgage rates above 6% have pushed many prospective buyers toward rentals and weighed on institutional bulk acquisitions. Banks are tightening loan-to-value thresholds, leaving highly leveraged owners vulnerable to negative equity, particularly where 2021-era prices have retreated.

Segment Analysis

By Property Type: Condominiums command share while villas outpace on growth

Apartments and condominiums controlled 58% of global residential real estate market revenue in 2024, supported by urban density and affordability relative to land-based homes. Demand is strongest in Asia-Pacific capitals where land constraints force vertical solutions and where rapid transit expansions raise condominium values. Dubai’s prime high-rise corridors show transaction volumes rising even as villa prices appreciate faster, underscoring the liquidity of the segment.

The villa and landed-house category is forecast to grow at 6.19% CAGR to 2030 in the residential real estate market. Wealth migration, remote-work flexibility, and post-pandemic lifestyle preferences are driving buyers to larger plots outside congested cores. Institutional investors are also assembling single-family rental portfolios across the United Kingdom and the United States, capitalising on energy-efficient builds that fetch premium rents. Prefabricated construction has cut build times by up to 50%, allowing supply to respond more nimbly. As a result, the global residential real estate market size attached to landed formats is set to expand more rapidly than historical averages.

Note: Segment shares of all individual segments available upon report purchase

By Price Band: Mid-market breadth meets luxury acceleration

The mid-market bracket captured 45% of 2024 spending in the residential real estate market, reflecting the sheer volume of households earning close to median wages. Government incentives such as Canada’s 30-year insured mortgage for first-time buyers bolster this tier. Institutional build-to-rent projects often target this affordability band, given its resilient occupancy and predictable cash flows.

Luxury stock, which includes super-prime assets above USD 10 million, is poised for 6.26% CAGR. Dubai led the world in USD 10 million-plus transactions during 2024, while coastal Portugal and alpine Switzerland posted double-digit price gains. Tokenised co-ownership schemes are widening the buyer base and could lift the global residential real estate market share of luxury assets during the forecast horizon. Limited trophy supply and the brand value of marquee destinations underpin further upside.

By Business Model: Secondary liquidity vs primary growth

Secondary transactions represented 59% of turnover in 2024, benefiting from mature inventories and quicker closings. In markets such as Germany, regulatory stringency and energy-performance obligations make refurbishing existing stock more attractive than navigating approvals for new builds.

Primary development, however, should grow 6.61% annually as shortages force governments to fast-track permits. Dream Finders Homes recorded a 40% rise in unit deliveries in Q4-2024 and reported USD 1.5 billion in quarterly revenue. Australia allocated USD 54 million to accelerate modular methods, signalling policy commitment to new stock. The resulting lift in completions enlarges the global residential real estate market size for freshly built product, helping narrow imbalances.

Note: Segment shares of all individual segments available upon report purchase

By Mode of Sale: Ownership dominance gives way to rental momentum

Home sales still made up 61% of 2024 residential real estate market value, reinforced by cultural preferences and tax advantages. Yet elevated mortgage costs are eroding affordability, nudging many households toward long-term renting. Europe forecasts average residential rents to climb 3.2% annually through 2029, outpacing headline inflation. Mid-America Apartment Communities maintained occupancy above 95% and delinquency near 0.3%, illustrating the stability of professional rentals.

Institutional platforms refine the tenant experience with AI lease screening, IoT-enabled maintenance, and dynamic pricing. These efficiencies lower operating costs by up to 25%. Consequently, rental growth at a 6.79% CAGR is set to chip away at the ownership share, reshaping consumer decisions within the global residential real estate market.

Geography Analysis

Asia-Pacific accounted for 33.10% of global residential real estate market revenue in 2024 and is projected to expand at a 6.91% CAGR through 2030. China’s policy support for affordable housing is stabilising sales volumes, while Japan’s multifamily sector benefits from low vacancy and limited new supply. Australia faces acute shortages; median Sydney values reached AUD 1.3 million, prompting a USD 33 billion federal programme that targets 1.2 million new homes in five years^{[6]Australian Department of the Treasury, “National Housing Accord Implementation Plan 2025,” Australian Government, treasury.gov.au}. Transaction volumes picked up in Singapore, Korea, and India, helped by easing border restrictions and increased foreign enrolment in education hubs.

North America maintains a sizeable base but wrestles with affordability and financing headwinds. The United States faces a deficit of up to 3.8 million units, keeping 45% of renters cost-burdened. Canada’s Build Canada Homes vehicle committed more than USD 25 billion to modular construction and aims for 500,000 annual starts. Institutional buyers remain active; KKR’s coastal portfolio acquisition underscores confidence in demographic resilience despite mortgage rate pressure.

Europe shows resilience through robust rental demand. Residential investment volumes rose 33% year-on-year to EUR 47 billion, representing 27% of total real-estate capital flows. Germany may be short more than 1 million units by 2027, with tax incentives lifting investor returns to as much as 25% per year on energy-efficient refurbishments. The UK offers the highest projected total return at 9.8% annually, supported by tight vacancy and upward-trending rents aew.com. In the Middle East, Dubai posted 20% price appreciation and 19% rental growth in 2024 on the back of 6.6% population growth.

South America is regaining momentum in the residential real estate; regional GDP growth is anticipated to improve from 2.2% in 2024 to 2.5% in 2025, led by Argentina’s 3% real-estate expansion outlook. Climate-induced relocations, particularly within Brazil and Chile, are altering internal migration maps and encouraging mixed-use master-planned communities that embed resilience into design standards.