Will M&A continue as a factor in home building in 2016?

Nature abhors a vacuum, and, to a very real degree, the home construction sector seems to abhor the kind of consolidation that has made other industry sectors more productive, profitable, and cycle-tolerant.

Here, Forbes staffer Antoine Gara looks at the economic dynamics, operating conditions, and pre-disposition of corporations, their boards, and their stakeholders and sees no significant change to an environment that has driven mergers and acquisitions deal levels to the nearly $5 trillion mark in 2015. Gara writes:

Corporations are using cheap debt financing to buy competitors and wrench out synergies that can quickly grow their earnings. Amid a mostly halting economic recovery in the United States, M&A has proven far more attractive and easy to pitch to investors than an expansion, which might require increased plant and equipment and rising expenses. For the nation’s largest companies, there’s also been a race to increase market power, or respond to consolidation among competitors.

Still, for home building, the truism stands, "all real estate is local." Different rules may apply. Or may not.

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