The analysis draws on three reports: the World Domestic Boilers Market 2026 and World Commercial Boilers Market 2026, alongside the Worldwide Heat Pump Markets 2026. BSRIA’s boiler analysis is uniquely split into separate domestic and commercial reports, recognising the fundamentally different dynamics and market sizes of each segment.
The analysis finds that, despite ongoing challenges in global construction activity and continued consumer caution, the market is showing signs of stabilisation. In 2025, around 3.5 million hydronic heat pumps were sold globally, representing modest growth of 4% following a difficult 2024.
Over the same period, just under 13 million boilers were sold, 90% of which were gas.
This indicates that the boiler market remains broadly flat. However, it still equates to 3.8 boilers sold for every heat pump, underlining the scale of the existing installed base and the gradual pace of transition.
Socrates Christidis, research manager, heating and renewables at BSRIA, said: 'The market is not moving in a straight line. What we are seeing is a sector responding to a complex mix of pressures from energy prices and security concerns, through to evolving policy frameworks and the practical realities of installation. The transition is happening, but the boiler market is in a phase of managed decline, rather than sharp contraction.”
Boilers sustained by replacement demand
With around 200 million boilers currently in operation worldwide, approximately half of which are older non-condensing units, demand is now largely driven by replacement and retrofit activity rather than new build.
In mature markets such as Europe and North America, replacement and retrofit accounts for the vast majority of demand, supported by the reliability, familiarity and lower upfront cost of boiler systems.
However, over the long term, the market is expected to contract gradually, with BSRIA forecasting a compound annual growth rate of -2% for fossil fuel boilers between 2019 and 2029.
Heat pump market begins recovery
Following a challenging period, the heat pump market is showing early signs of recovery.
BSRIA identifies 2025 as the start of a renewed growth phase, with hydronic heat pumps forecast to grow at a compound annual rate of +8% between 2019 and 2029.
While the new build sector continues to support adoption, the most significant long-term opportunity lies within existing building stock. By 2029, hydronic heat pumps are expected to account for around 12% of activity within the replacement and retrofit market, rising from a relatively low base.
Air-to-air heat pumps, including minisplits and multisplits, also continue to expand, reaching around 100 million units in 2024 and growing by 8% in 2025. BSRIA estimates that between 5% and 8% of these are used as a primary heating source.
However, pricing remains a barrier. Heat pump costs are continuing to track inflation, driven by high raw material costs, more expensive components, the pursuit of higher efficiencies and ongoing skills shortages across the installation base.
Replacement market becomes competitive battleground
A central finding is that the replacement and retrofit segment is now the defining battleground for the global heating market. Around 73% of total heating demand globally is driven by replacement, rising to over 90% in mature markets.
This shift is intensifying competition between boilers, heat pumps, hybrid systems and district heating, particularly as the replacement market becomes increasingly competitive
Installation cost and disruption remain key barriers to wider heat pump adoption, particularly in retrofit scenarios. However, emerging innovations including AI tools and pre-assembled systems are beginning to reduce these challenges.
Under BSRIA’s progressive scenario to 2035 – as opposed to its business as usual five-year outlook – heat pump growth across the top five European heating markets could reach around 20%, alongside a projected decline of around 7% in the gas boiler market, assuming cleaner electricity, stronger policy frameworks and increased investment in installer capacity.
Transition driven by policy, economics and practical delivery
The data highlights that the transition is not being driven by a single factor, but by the convergence of policy direction, energy economics and real-world delivery constraints.
While regulation and decarbonisation targets continue to shape long-term direction, short-term market performance remains closely tied to affordability, energy prices and the ability to deliver solutions at scale.
Christidis continued: 'The ratio of 3.8 boilers sold for every heat pump in 2025 tells you where the market is today. Heat pumps are becoming mainstream, even in North America, and boilers are declining, but very slowly. And the opportunity is not in new build alone. It is in the retrofit and replacement market, and that is where the real competition is beginning.'
This global market analysis forms part of BSRIA’s annual updates on heat pumps and the domestic & commercial boiler sectors. Unlike single-report market overviews, BSRIA’s boiler research is split into dedicated domestic and commercial reports, reflecting the fundamentally different dynamics and scale of each segment, from residential systems up to 50kW to commercial heating applications reaching 3.7MW.
The findings are based on extensive primary research conducted with industry stakeholders in late 2025 and the first quarter of 2026, the studies deliver robust insights to inform strategic decision-making and support market growth.
To find out more about BSRIA’s Worldwide Boilers 2026 Reports or the Worldwide Heat Pump Markets 2026 Report, visit here.