Big Builders Flexing Market Muscle

The big bruisers of the building business have been flexing their muscles, according to new research from the National Association of Home Builders, which found that the country's 10 largest firms have almost doubled their market share over the last five years.Expanding largely through mergers and acquisitions, the top 10 racked up 20% of all new home closings last year. In 1997, they had only an 11% market share. In numerical terms, the behemoths recorded 191,800 closings in 2002 versus 86,990 five years earlier, the research indicates. Though the market is still characterized by numerous small firms, the largest 60 builders were responsible for nearly 312,300 closings in 2002. In 1992, they closed only 111,900 deals. In total, the largest 60 builders have almost one-third of the entire new market. The largest 100 own 35.4% of the business. "Small builders still remain the dominant force in the housing industry," said NAHB economist Elaine Frey. "The question is, for how long?" In some place, the giants already dominate. In Austin, Texas, for example, the five largest builders now own 79% of the market, up from 52% a decade ago. In Denver, they have a 58% market share, up from 42%. The increase is even more dramatic in Miami, where the big five now have a 46% market share, up from only 13%.