Top 10 Publicly Traded Builder Share Up in 2016

Filed in Economics by on April 5, 2017 0 Comments

The top 10 publicly traded builders captured 27.4% of the 559,000 new single-family home sales reported by the Census Bureau in 2016, up from 25.6% in 2015.

As NAHB economist Steve Melman observed in a recent Eye on Housing blog post, publicly traded companies possess many advantages over small builders. These include better access to credit from their own balance sheets, and economies of scale in land and material purchases as well as in advertising and land holdings.

However, small builders are better positioned to address the growth in, and the knowledge of, their local markets. Their flexibility allows them to customize their product to meet local demands and preferences. Also, small home building companies usually have their roots in the local market and can use those more personal relationships to improve quality and increase repeat business.

The often-held small builder concern that the large national companies will take share away has not occurred. The residential construction industry remains primarily a sector dominated by a large number of small entrepreneurs.

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