Siding is an essential exterior component for many residential and commercial buildings. When choosing surface solutions, property owners often express decision factors about function—how well they withstand weather and other intrusive elements, and form - how they contribute to the building’s aesthetics.
In recent years, the siding industry also has been influenced by demands for energy efficiency, sustainability, easier/faster installation, and increased durability and customization. New technologies and innovations have shaped the market, providing manufacturers with fresh ways to meet the needs and preferences of customers.
The outlook of the construction industry is strong, bolstered by a large residential renovation segment, which will contribute to demand for siding materials in the coming years.
What is the Forecast for the Siding Market?
The siding market is experiencing steady growth. Data from Lucintel indicates that the global siding market was valued at approximately $119.7 billion in 2023 and is estimated to experience a compound annual growth rate (CAGR) of 3% to reach approximately $150 billion by 2030.
HIRI size of market data corroborates this story.
Because of its low cost, ease of maintenance, and variety of colors, vinyl continues to claim the largest siding market share, with fiber cement also a highly popular material for exterior surfaces.
The Asia-Pacific region leads the market, with rapid urbanization, sustainable development, and the construction sector factors that contribute to the region’s growth, according to Stratview Research. Latin America also presents significant growth potential, while in the U.S., the South is the largest regional market. New construction has stagnated in the states over the past couple of years, but demand within the home repair and remodeling sector has remained relatively steady, presenting growth opportunities for industry professionals and manufacturers.
Some of the leading players in the market include James Hardie, Nichiha, Cornerstone Building Brands, Boral, Westlake, Louisiana Pacific, and Kingspan Group.
What Trends Will Influence the Siding Industry in 2025?
A variety of factors shape the siding market at both the regional and global level, including cost, efficiency, temperature-resistance, simplicity of installation, durability, and adaptability. Manufacturers and distributors are responding to changes in customer preferences and demands, as well as challenges from inclement weather, supply chain disruptions, and skilled labor shortages. There are also code changes that could further impact material selection.
As we look ahead to 2025, here are some of the top trends in the exterior insulation and finish system siding market:
1. Sustainability and Energy-Efficiency Spur Innovation
Siding is a key component when it comes to a structure’s energy efficiency, how well it regulates temperatures and protects the interior from external elements. With energy costs rising alongside inflation, building owners are looking at ways to maximize energy efficiency.
Data from Lucintel shows that Canadian siding manufacturers—including Maibec Inc. and Westlake Royal Building Products—are investing in the development of sustainable and durable surface solutions. They are focused not only on incorporating energy efficient siding materials, like recycled and recyclable content, into their siding procuts, but also pursuing and implementing sustainable production methods.
In the United States, we’re also seeing innovations from companies like James Hardie and LP Building Solutions, with the latter committing to a range of sustainable practices. Other notable players in this area include German siding companies Eternit GmbH and Trespa and Gentek Building Products, which recently launched a new line of energy efficient insulated siding. The EnFusion line is fortified with EPS (expanded polystyrene) to help seal out inclement weather elements.
These developments coincide with the Canada Greener Homes Grant program, the Energy Star program in the U.S., and other government initiatives that financially incentivize homeowners to utilize energy-efficient siding materials.
2. Integration of Smart Technology
Another trend in the siding industry is the integration of smart technology. Manufacturers are exploring options for interactive designs, energy monitoring, built-in sensors, and insulation efficiency.
The goal of integrating siding and home automation systems is to enable homeowners and commercial building owners to be able to monitor and control certain features—such as security, temperature, and lighting—from a centralized location. Using remote access, schedules, and sensors, they have more control over the structure, no matter where they are, which offers peace of mind and much-desired convenience. .
Building products manufacturers can tap into this trend by developing products that are compatible with automation systems and lend themselves to a cohesive living environment.
3. Increasing Durability Against Extreme Weather Events
As extreme weather events become more common in the United States and abroad, companies are also responding to the consumer demand for low-maintenance siding materials that provide durability and longevity, and can withstand various weather elements. Homeowners are concerned with protecting their homes and personal property, while also reducing the costs of long-term upkeep, and manufacturing companies are working to meet that demand as a way to capture a greater market share.
For example, since introducing fiber cement to the market in the 1980s, James Hardie has continued to invest heavily in this product, making it a suitable option for both commercial and residential application, thanks to its weather-resistance and enhanced durability. The company has been opening new manufacturing locations and reported year-over-year growth in the North American market for the third quarter of 2024. Over the next few years, fiber cement is expected to be a segment with high growth opportunities.
Additionally, Westlake Royal Building Products is a leader in the square vinyl siding market, touting it as a low-maintenance option that doesn’t warp, buckle or sage, yet has the ability to withstand hurricane-force winds up to 180 mph.
Disaster mitigation and retrofitting represents a massive opportunity in the Western and Southeastern states due to increasing fire and high-wind events. However, there are also increasing opportunities throughout the country as the Midwest and Northeast experience increased weather events related to wind and moisture.
4. Providing Options for Customization
Homeowners have a growing preference for personalized designs and unique aesthetics, which is prompting the proliferation of customizable siding options. Earlier this year, Cornerstone Building Brands announced that it had refreshed its Ply Gem portfolio, which includes a variety of exterior surface solutions. The brand refresh was designed to meet demand from builders, contractors and distributors for compatible solutions and durable products that elevate curb appeal.
We’re also seeing architectural versatility, from modern colors and finishes to siding materials that resemble natural textures. Heading into 2025, consumer demand for product diversifications presents opportunities for both the top players in the siding industry, as well as newcomers.
5. Strategic Partnerships and Collaborations
Across the market, manufacturing companies are collaborating with not only distributors, but also contractors and builders, to expand market reach, streamline supply chains, and try to reduce costs. From new product development and design to product improvements and marketing strategies, manufacturers benefit by aligning with changes in the research and purchasing habits of contractors and professional tradespeople, as well as what they expect and need from manufacturers to build brand loyalty.
In August 2024, James Hardie announced a multi-year exclusivity agreement with Meritage Homes, the fifth-largest public homebuilder in the U.S. This agreement, regarding homes that use hard sidings, will go through at least 2027. Meanwhile, Hardie has extended its partnership with Habitat for Humanity to activities in Europe.
There have also been some notable mergers and acquisitions in recent years. For example, in 2022, Saint-Gobain completed its acquisition for Kaycan, which enabled the former to capture a larger share of the siding market in North America, expanding its product offerings.
Siding Market Research and Analysis for Industry Professionals
For building products manufacturers and distributors, customized market research can provide more extensive data and insights into the siding industry, including market sizing, segmentation, and customer preferences. It can help you understand your target audience and how your product category relates to construction and home improvement industries, enabling you to identify new opportunities for growth.
To equip your marketing, brand, channel and product teams with the information they need in order to launch successful campaigns, it’s important for them to know who to target, what purchase motivations to speak to, where to invest marketing dollars, and when to ramp up efforts.
That’s where custom market research into consumer behaviors can help. Regardless of your company’s goals, our team at the Farnsworth Group takes the time to understand your specific needs, leveraging decades of industry knowledge and creating customized research to guide your home improvement strategy.
