Global Homes and Buildings Industry Outlook, 2025

The homes and buildings industry maintained its growth momentum in 2024, recording a 6.9% expansion despite ongoing economic and geopolitical uncertainties. In 2025, the industry is projected to grow within a range of 4.3% to 8.6%, driven by increasing demand for property technology solutions, smart home solutions, sustainable climate control systems, and data-driven building optimization strategies. The adoption of AI, IoT, and automation continues to accelerate, reshaping intelligent building solutions and construction management.

Despite strong growth, the industry faces persistent challenges, including rising building O&M costs, AI integration complexities, construction project delays, labour shortages, and market volatility. Additionally, geopolitical uncertainties—including the Trump administration’s anti-climate stance—pose potential roadblocks to clean energy progress and sustainability initiatives in North America.

Frost & Sullivan’s 2025 Homes and Buildings Outlook delivers a comprehensive analysis of key industry predictions and opportunities, covering lighting, critical building equipment, facility management, smart building management, smart homes, and construction management. The report provides regional insights for North America, Europe, Asia-Pacific, and the Rest of the World, with a focus on service innovations, AI evolution, growth in data center segment, and the evolving construction technology landscape.

A major industry shift is the emergence of AI agents in SaaS-based construction management and building operations, which is poised to redefine efficiency and automation. Furthermore, the smart home industry is transitioning from a hardware-driven model to a subscription-based ecosystem, enhancing user personalization. Other notable developments include AI-driven predictive energy management, unified building intelligence platforms, connected HVAC solutions, and the growing role of robotics and automation in sustainable construction.