China's Prefab House Industry Flourishes with Policy Boost and Tech Innovation

In recent years, China’s prefabricated housing sector has maintained strong growth momentum, driven by government policy support, technological advances, and diversified market demand. In 2024, its market size reached RMB 58.7 billion (US$8.2 billion), representing a 13.4% year-on-year increase. It is expected to hit RMB 68 billion (US$9.5 billion) in 2025, with an average annual growth rate of 15%¹. This growth trajectory is in line with the 14th Five-Year Plan’s target of prefabricated housing accounting for over 30% of new residential construction by 2025². These policy guidelines have fostered widespread industry compliance, laying a solid groundwork for steady expansion.

Policy incentives have served as a cornerstone. In 2024, the central government allocated RMB 42.6 billion to support 86 pilot cities and industrial bases, with 31% dedicated to modular housing research and development². Local governments have further boosted this trend through subsidies, providing financial rewards for projects adopting standardized prefabrication solutions². Enterprise-driven technological innovations have accelerated industrial upgrading, significantly shortening production cycles and cutting waste emissions.

Market demand has extended beyond traditional sectors: cultural tourism camps, emergency shelters, and affordable housing projects are driving growth, with modular units contributing up to 40%¹. East and South China dominate the market, while central and western regions are recording faster growth rates fueled by infrastructure development¹.

Looking ahead, the industry is poised for long-term growth. By 2030, its market size is projected to exceed RMB 126 billion (US$17.6 billion), with a compound annual growth rate (CAGR) of 12.8%¹. Against the backdrop of stricter carbon neutrality targets and advancing urbanization, prefabricated housing—with its advantages of environmental friendliness, high efficiency, and flexibility—will undoubtedly become the backbone of China’s modern construction system, facilitating the transition from policy-driven to market-led growth².