Despite persistent affordability issues and a challenging housing market, the merger and acquisition (M&A) market has remained active. More importantly, the character of that activity is changing. Recent transactions point to an industry increasingly driven by consolidation, with well-capitalized buyers pursuing scale through acquisitions of both private and publicly traded builders.
Sumitomo Forestry’s $4.5 billion purchase of Tri Pointe Homes and Berkshire Hathaway’s $8.5 billion purchase of Taylor Morrison represent several trends that have emerged in the M&A market: public companies being taken private, rapid market consolidation, and the race for scale. The past two years has seen five public companies sold—M.D.C Holdings, Landsea Homes, United Homes Group, Tri Pointe Homes, and Taylor Morrison—with another, Beazer Homes, being publicly pursued by Dream Finders Homes.
Margaret Whelan, founder and CEO of Whelan Advisory, says those deals reflect a broader shift in how builders are thinking about growth.
“Big industries consolidate very quickly because there are real benefits to scale,” Whelan tells BUILDER. “It’s no longer about being public versus being private as a builder. It’s about the best capital structure you can realize.”
Among the recent transactions, Whelan believes Berkshire Hathaway’s acquisition of Taylor Morrison carries the broadest implications. Beyond validating Taylor Morrison’s operating strategy, she views the deal as a sign that one of the world’s best-capitalized investors sees long-term value in the housing market despite today’s headwinds.
“The first thing I thought when I saw the Taylor Morrison-Berkshire Hathaway deal was that the housing market is bottoming,” Whelan says. “You have a buyer like Berkshire Hathaway that is so well-capitalized that they can buy anything at any time. The fact that they are doing this deal now is them calling the bottom of the market.”
If the thesis is proven true and the housing cycle is beginning to turn, Whelan believes the momentum in the M&A market will continue to remain strong.
“We’ve had a record level of M&A for the last two years and I expect that to continue,” Whelan says. “It is increasingly hard to operate. Capital is available, but it is expensive. Scale is very relevant, but not available to everybody. It’s a jump or get pushed mentality for a lot of these companies.”
The M&A market, as it has been for the past several years, remains one skewed toward the sellers. The number of potential buyers— public builders, private equity firms, and foreign buyers—is as large as it has ever been. Historically, the lower cost of capital available to Japanese companies has meant they have been able to be more aggressive in valuations on prospective deals in the U.S. market. For U.S. buyers, this has meant they have also had to become more assertive in valuations to remain competitive to deals. A mix of competition for deals and high valuations is driving the prices sellers can command higher, another positive for companies looking to sell in the current environment.
Japanese Momentum
The Sumitomo Forestry purchase of Tri Pointe Homes, coupled with Daiwa House-backed Stanley Martin’s purchase of United Homes Group and Sekisui House’s 2024 purchase of M.D.C. Holdings, represents the growing scale of transactions being pursued by Japanese buyers.
A decade ago, Japanese buyers typically acquired majority stakes in small local or regional builders. Today, they are pursuing multibillion-dollar public company acquisitions.
“The bigger companies are making bigger bets,” Whelan explains. “They have massively grown and felt very comfortable with the growth and very confident.”
Even as the deals have scaled, the Japanese companies continue to offer selling companies a unique opportunity relative to other buyers. The partnership mindset means Japanese companies often retain the existing team and legacy of acquired companies rather than changing branding, marketing, and product mix, which helps foster a collaborative environment without forcing synergies.
Sumitomo Forestry’s portfolio includes Tri Pointe Homes, DRB Group, Brightland Homes, Bloomfield Homes, Edge Homes, and MainVue Homes, representing approximately 18,000 annual closings, which would rank as the fifth largest company on the Builder 100 list.
Daiwa House, which has U.S. hubs in the east (Stanley Martin Homes), central (CastleRock Communities), and west regions (Trumark Homes), has completed two transactions in the Southeast in the past year with its purchases of United Homes Group and North Carolina-based Windsor Homes and one in the Pacific Northwest with its purchase of JK Monarch. Taken together, the company has a portfolio of approximately 8,860 closings, which would rank as the 14th largest company on the Builder 100 list. Sekisui House, the 2026 Builder of the Year, ranked No. 8 on the 2026 Builder 100 list with 11,712 annual closings.
While the volume of activity has slowed a bit as the scale of deals has accelerated for the Japanese companies, Whelan does not anticipate the appetite in the U.S. market to slow. The recent purchase of Utah-based Wright Homes by U.S. market newcomer Hajime Construction suggests interest is only continuing to accelerate.
“When you buy a public company like Sekisui House buying M.D.C. Holdings, of course you are going to pause a while to digest,” Whelan explains. “The first wave of Japanese companies came in slowly and methodically and gained their footing. They are now doing much bigger deals and there is a new wave of companies right behind them.”
Move-Up Appeal and the Attraction of Affordability
Many of the deals that have taken place in 2026, including Stanley Martin’s purchase of United Homes Group and Mungo Homes’ purchase of McGuinn Homes, highlight the ever competitive battleground for scale in the Southeast.
“The Southeast remains extremely attractive. The Midwest is also attractive, too. Anywhere that is affordable is attractive,” Whelan says. “With the Southeast, the markets are bigger [than the Midwest]. The cities in the Midwest are much smaller, so that means the builders are smaller. You will see movement, but it won’t be at the same scale as the Southeast.”
Beyond geography, product diversification and demographic shifts are also driving acquisition activity. Builders that have traditionally specialized in either entry-level or move-up housing are looking to expand into product offerings via acquisition rather than building those capacities organically.
“The move-up product is very popular. It used to be that you start your family and buy an entry-level home,” Whelan says. “But now, a lot of people are waiting longer. When you wait, you are earning at a different level, you have more savings, [you may have access] to the bank of Mom and Dad. So, the first home you are buying is not necessarily a starter home or an expensive home.”
