A Closer Look: Wall Panel Growth Potential
Back in January, SBC Magazine covered a Home Innovation Labs’ report that indications a positive five-year outlook for structural component framing. This article series is looking at exactly which products are poised for growth, who will be using them and which regions will see the most robust growth.
Wall panels hold a very low market share in single-family dwelling (SFD) construction compared to traditional site built methods for light frame wall construction in above grade conditions. Seven percent of these types of walls utilize a factory built solution while a resounding 90 percent are site built. Beyond the difference in total market share, 14 percent of builders indicated they plan on using open wall panels more often in the next 5 years and 12 percent plan on using closed wall panels more often over the same period. Conversely, 6 percent and 4 percent of builders surveyed plan on using open and closed wall panels less often, respectively. Large builders (25+ units) are more aggressive with their moves toward wall panels. They anticipate using open wall panels 19 percent and closed wall panels 14 percent more often compared to small builders (1-24 units) who only plan on using open and closed wall panels 5 percent and 6 percent more often.
Builders in the Midwest are most actively looking to wall panels as a framing solution, with 19 percent of which anticipating an increased use of open wall panels and 14 percent using more closed wall panels. Builders in the West plan on utilizing both open and closed wall panels 11 percent more over the next five years and 4 percent of those surveyed in the South plan on increasing their use of open wall panels while only 2 percent see an increased use of closed wall panels. Northeast builders surveyed actually indicated a decrease in usage of open wall panels by 7 percent with 2 percent reporting a five year increase usage of closed wall panels. Increased use of wall panels appears to be evenly spread amongst various housing types, ranging from 9 percent to 11 percent between Starter, Move-up and Luxury Homes, with an exception of closed wall panels for starter homes, which polled an increase of only 6 percent amongst builders. Six- percent of Customer builders plan on using both open and closed wall panels more on their projects, while Semi-Custom builders plan on increasing their use of open wall panels by 4 percent and closed wall panels by 9 percent. Product builders anticipate an increase of 11 percent for open wall panels and 6 percent for closed wall panels.
|All Builders||Small Builders (1-24)||Large Builders (25+)|
|Pre-Cut Framing Package||6%||3%||19%|
|Factory-Built Open Wall Panels||8%||5%||19%|
|Factory-Built Closed Wall Panels||7%||6%||14%|
|Panelized, Pre-Assembled Floors||8%||4%||22%|
|Precast Floor, Wall, or Roof Panels||7%||4%||15%|
Despite an overall low market share, wall panel usage indicators appear to be trending upward, specifically in the Midwest and West where labor constraints are more widespread and adoption of component solutions is more robust. Large builders see the value of wall panels more than any other group as they look to increase throughput on projects and leverage their framing crews better with manufactured framing solutions. Northeast builders alternatively appear to be moving away from wall panels with more indicating they will use panels less that those who plan on increasing their use of panels in the next five years.
For more information on the Home Innovation Labs’ 2018 report, read these articles:
- Chart: Will Home Builders Increase Use of Trusses in 2019?
- Chart: What Will Happen to the Wall Panel Market in 2019?
- Chart: What Builders Will Use Component Framing More?