South America Residential Construction - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2026 - 2031)

According to Mordor Intelligence, the South America residential construction market size is projected to be USD 299.28 billion in 2025, USD 323.82 billion in 2026, and reach USD 482.20 billion by 2031, growing at a CAGR of 8.29% from 2026 to 2031.

South America Residential Construction Market Trends and Insights

Affordable Housing Program Funding Supports Residential Construction

Public funding gives developers a more stable base of housing demand when private credit is limited. Brazil's Minha Casa, Minha Vida program, known as MCMV, has contracted 2.4 million homes since 2023 and targets 3 million homes by the end of 2026. Its annual allocation reached USD 27.3 billion, compared with USD 22.7 billion in 2025. Brazil also allocated USD 1.9 billion to 85,000 MCMV homes through the New PAC program in June 2026. These commitments support new project pipelines across income groups and regions.

Urban Housing Deficits Drive New Residential Development

Housing shortages keep demand for formal homebuilding in place across the region. Brazil's quantitative housing deficit stood at 5.77 million units in 2024, while Colombia reported a deficit of 4.81 million homes in 2025. Chile's Ministry of Housing and Urban Development estimated a shortage of 491,804 homes using the 2024 census. These deficits support long-term demand even when high interest rates delay private purchases. Builders with approved land and access to public programs can address demand as financing conditions improve.

High Mortgage Rates and Credit Selectivity Limit Buyer Demand

High interest rates reduce the number of buyers who can qualify for conventional mortgages. Brazil's Selic policy rate reached 15% in 2026, increasing pressure on regulated mortgage products. Colombia also saw a gap between new-home sales and construction starts in 2025. Argentina's mortgage-backed purchases fell by more than 37% in the first 5 months of 2026 from the same period in 2025. Program-linked developers are therefore better placed than builders who rely on market-rate mortgage demand.

Other drivers and restraints analyzed in the detailed report include:

1. Social Rental and Subsidized Mortgage Programs Expand Housing Demand
2. Urban Density Increases Demand for Vertical Housing
3. Construction Cost and Skilled Labor Volatility Pressure Project Viability

For complete list of drivers and restraints, kindly check the Table Of Contents.

Segment Analysis

Apartments/condominiums held 55.00% of the South America residential construction market size in 2025. Their position reflects long-standing urban concentration in Brazil, Colombia, and Chile, where infrastructure and employment are concentrated in major cities. Multi-family projects make more intensive use of costly urban land and can serve both affordable and middle-income buyers. In Sao Paulo, vertical projects linked to Minha Casa, Minha Vida represented a substantial share of residential launches and sales in 2025. Developers also use apartment projects in premium segments, which broadens the format beyond social housing. Cyrela launched Heritage Riviera in Porto Feliz in 2026, a multi-phase development with potential sales of USD 536 million to USD 714 million. This shows that denser project formats can also be used in higher-value residential communities.

Villas/landed houses are forecast to expand at an 8.70% CAGR through 2031. The format benefits from demand outside expensive urban cores, especially in secondary Colombian cities. Amarilo S.A.S. expanded its geographic presence into Pereira and Cucuta and planned a 3,385-unit social housing project near Armenia. These moves indicate that land availability and affordability can support horizontal development where major-city prices rise. Chile's DS 1 subsidy also supports construction on owned sites for middle-income households. This creates a distributed source of single-family development that is not limited to large developer-led projects. The South America residential construction market includes both urban towers and outward residential growth, with each responding to a different housing need.

New construction accounted for 78.00% of the South America residential construction market size in 2025. Government programs continue to emphasize fresh-unit delivery, and household formation remains an important source of demand in Brazil and other countries. New projects also absorb migration into growing cities and provide the physical supply needed to reduce quantitative housing shortages. Program funding can support new construction even when conventional credit conditions are restrictive. Large housing allocations in Brazil, Peru, and Paraguay, therefore, have a direct effect on development pipelines. New Construction remains important to listed developers because it supports repeatable project models and access to formal housing finance. Its scale also supports demand for building materials, contractors, and utility connections.

Renovation is forecast to grow at a 9.40% CAGR through 2031, the fastest pace within the construction type. This growth follows the large number of existing homes that require repairs or improvements to meet habitability needs. Brazil's Housing Improvement stream and Colombia's Decree 413 of 2025 direct public support toward this part of the housing shortage. Renovation projects generally have lower ticket values and avoid the land costs that affect new developments. Their shorter project cycles can help contractors deploy capital more frequently during periods of high financing costs. Colombia's seismic construction rules apply to structural interventions, including renovations, which increases the importance of qualified contractors. The South America residential construction industry can therefore gain from repair work as well as from large new residential developments.

Complete Report Scope:

• By Type
  • Apartments/Condominiums
  • Villas/Landed Houses
• By Construction Type
  • New Construction
  • Renovation
• By Construction Method
  • Conventional On-Site
  • Modern Methods of Construction (Prefabricated, Modular, etc)
• By Investment Source
  • Public
  • Private
• By Country
  • Brazil
  • Argentina
  • Colombia
  • Chile
  • Rest of South America

List of Companies Covered in this Report:

1. MRV Engenharia e Participacoes S.A.
2. Cyrela Brazil Realty S.A.
3. Direcional Engenharia S.A.
4. Cury Construtora e Incorporadora S.A.
5. Construtora Tenda S.A.
6. EZTEC Empreendimentos e Participacoes S.A.
7. Even Construtora e Incorporadora S.A.
8. Gafisa S.A.
9. Plano&Plano Desenvolvimento Imobiliario S.A.
10. Trisul S.A.
11. Tecnisa S.A.
12. Moura Dubeux Engenharia S.A.
13. Melnick Desenvolvimento Imobiliario S.A.
14. Pacaembu Construtora S.A.
15. Socovesa S.A.
16. Besalco S.A.
17. SalfaCorp S.A.
18. Constructora Bolivar S.A.
19. Amarilo S.A.S.
20. Constructora Conconcreto S.A.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support