The modular market is worth $111 billion. Or $20 billion. It depends who's counting.

Ask three research firms how big the modular construction market is and you will get three answers that do not overlap. Grand View Research puts the global market at $111.1 billion in 2025, heading to $207.8 billion by 2033 at an 8.2% compound rate.² Precedence Research says $228.7 billion by 2035.⁵ An older MarketsandMarkets estimate had the permanent modular segment alone reaching $111.8 billion by 2030.⁴ A 2023 forecast pegged the whole thing at $114.8 billion by 2028.⁶

Meanwhile the Modular Building Institute, working with FMI Consulting, sizes the US permanent modular construction market at $20.5 billion for 2025.¹ North America, per Grand View, is 14.3% of the global figure — which would imply roughly $16 billion, in the same neighbourhood as MBI's number once you allow for relocatable buildings and Canada.²

So the North American numbers roughly reconcile. The global forecasts do not, and that is worth dwelling on before anyone puts a market-size slide in a pitch deck.

Why the numbers disagree

The forecasts diverge because the category has no agreed boundary. "Modular" in a research report may mean volumetric three-dimensional modules only, or it may sweep in panelised systems, bathroom pods, precast, relocatable site offices and anything else described as "prefabricated." The UK's Modern Methods of Construction framework splits this into seven categories precisely because a 44-storey volumetric tower and a factory-cut timber frame have almost nothing in common as businesses. Most market-sizing vendors do not disclose which categories they counted.

The honest reading is that the dispersion is a maturity signal. Industries with settled definitions — cement, elevators, HVAC — produce forecasts that agree within a few percent. Modular's do not, because the industry has not yet settled what it is selling. That matters for anyone raising capital on a total-addressable-market figure: the $200-billion-plus numbers are defensible only under the broadest definition, and the broadest definition includes competitors you will never displace.

North America at five percent

The single most important number in the sector is not a dollar figure. It is a share. MBI and FMI estimate that modular represents about 5.1% of US construction activity in the segments where it competes, and about 5.5% of the overall Canadian construction market.¹ Both figures are projected to grow faster than site-built construction — 6.5% compound annual growth for US permanent modular through 2030 — but from a base that has barely moved in a decade.¹

Five percent is not a nascent-technology number. Volumetric modular has existed commercially in North America since the 1950s. It is the number of an industry whose constraints are structural rather than technical: fragmented codes across fifty states and ten provinces, a financing model built for stick-built draw schedules, a labour movement with reasonable concerns about where the work goes, and a project-by-project procurement culture that resets the learning curve every time.

Where the growth is

Within the North American number, MBI/FMI identify residential and multifamily as the fastest-growing segment, at a projected 7.3% annual rate, driven by affordability pressure and disaster-recovery demand in the US West.¹ Treat the segment split as a trade-body estimate rather than a government statistic; there is no Census or Statistics Canada series that isolates volumetric modular. Hospitality, healthcare, education and — increasingly — data-centre and energy infrastructure are the other segments where repeatable room or equipment typologies make factory production sensible.

The pattern across segments is consistent: modular wins where the product is repeatable and the client is a repeat buyer. Hotel rooms, hospital wards, student accommodation, classrooms and supportive-housing studios are all repeatable. Bespoke condominiums with 179 bathroom variants are not, as Brooklyn discovered.

What mature markets look like

McKinsey's 2019 report remains the most-cited document in the sector, and it is more careful than its citers. It identified Japan and Scandinavia as the places where prefab housing has a "sustainable foothold," with the UK, the US West Coast, Australia's east coast and German cities as emerging markets.³ It projected a $130 billion modular market across Europe and the US by 2030, with potential savings of up to $22 billion a year.³

The same report also said that cost savings above 20% were "the exception, not the norm."³ Both halves are worth quoting. What Japan and Sweden share is not better factories. It is decades of stable demand from a small number of large buyers, standardised housing typologies, and a regulatory environment that certifies the factory rather than inspecting every module on site. That is a market-structure achievement, and it took forty years.

Modular is stuck at five percent in North America not because the technology is immature but because the market around it is.Volumetric Building editorial position

The government bet

The most interesting development of the past two years is that governments have started placing the bet that venture capital lost. In June 2021 Katerra, which had raised roughly $2 billion from SoftBank's Vision Fund to turn construction into manufacturing, filed for Chapter 11 with billions in debt.⁸ Five years later, Canada launched Build Canada Homes (September 2025) and in February 2026 issued a Request for Information on modern methods of construction — modular, panelised and prefab — to build a vetted-provider directory and prequalify suppliers for federally led developments.⁷

The thesis is the same one Katerra had: aggregate demand, standardise the product, run factories at volume. The difference is the buyer. A federal housing agency is a captive, long-horizon client of exactly the kind Hong Kong's Housing Authority and Singapore's Building and Construction Authority have been for their modular industries. Whether Ottawa can sustain that demand across electoral cycles is the open question; whether the thesis is sound is, on the international evidence, less open than Katerra's collapse made it look.

What to do with this

For manufacturers, the five-percent number is the addressable market, not the $200-billion one. Growth will come from converting repeat buyers in repeatable segments, not from evangelising one-off developers. For developers, the mature-market lesson is that the discount arrives with volume and standardisation, so a single modular project should be justified on schedule and certainty, not cost. For policymakers, the productivity gap is the argument: construction labour productivity has grown about 1% a year for two decades against 3.6% in manufacturing,⁹ and moving work into factories is the only credible route to closing it. For investors, the forecast dispersion is a warning about the denominators in the decks you are being shown.

We will update this analysis when MBI/FMI publish their 2027 figures, and we will note here if the North American share finally moves.