Demand for roofing in North America's residential market will climb to $6.3 billion in 2012 from $5.2 billion last year, while continental demand for insulation in commercial and residential projects will climb to $10.7 billion next year from more than $9 billion last year, Principia Consulting predicted Tuesday.

The Exton, Pa.-based firm based its insulation market forecast in part on an increase in construction activity as well as a focus on energy efficiency and better building codes. In a separate report, it based its roofing market predictions on reroofing demands for older homes and the growth of the new-home construction industry.

Overall demand for insulation has declined by 30% since 2006, while demand for roofing dropped by 11% from 2009 to 2010, Principia said. Lack of new construction projects was cited as the main culprit for the decrease in both markets. Poor interest rates, employment trends, shifts in consumer confidence, and lower availability of consumer credit were also reasons for the decline in the roofing market.

Consumer trends and habits changed for both industries also. In 2009, about 60% of insulation demand was for repair and remodeling, while 40% was for new construction. In 2006, new construction made up 65% of the demand for insulation. In the roofing market, reroofing, which in years past accounted for only 70 to 75% of demand, was good for 82% of the demand in 2010.

Demand in both markets may have dropped, but interest in products and projects have not. Heightened focus on energy conservation, new building codes, and government incentives to save energy have bolstered the insulation market. Meanwhile, in the roofing market, consumers are becoming more active in selecting roofing products as they are better informed compared to 10 or 15 years ago due to resources such as big box stores and the internet.