Single-Family Home Builders

The 59,300 single-family home construction service providers in the US oversee the entire construction of new single-family detached houses, townhouses, and row houses. The industry includes general contractors and design-build firms. Firms do not own the land they are building upon.

Variable Material and Labor Costs

The cost of construction materials and labor can vary significantly and affect profitability for new home builders.

Dependence on Subcontractors

New home construction is highly dependent on subcontractors, with most firms directly employing a limited number of workers to oversee subcontracting activity.

Aug 20, 2026 - Single-Family Construction Spending to Stay in the Red Until 2028

• US single-family construction spending is expected to decline 4% in 2026 to about $409 billion, according to FMI's third-quarter 2026 North American Engineering and Construction Outlook. Mortgage rates climbed back above 6.5% by late June, while new home sales remained below year-ago levels and housing supply stayed elevated. Builders are using incentives and smaller homes to support sales, compressing the dollar value of construction spending. High construction costs, labor constraints, tariffs, and affordability pressures also remain challenges. FMI projects spending to decline another 2% in 2027, followed by annual gains of 3% in 2028, 5% in 2029, and 6% in 2030.
• Home builder confidence in the single-family market rose slightly in August but stayed in negative territory as builders remain concerned about housing affordability, higher construction costs, and elevated mortgage rates, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), rose one point to 35 in August 2026. Any HMI reading over 50 indicates that more builders see conditions as good than poor. August marked the 16th consecutive month the HMI remained below 40, as well as the 16th month in a row where at least 30% of builders reported price cuts to lure buyers. In August, 35% of builders reduced home prices in the hope of stimulating demand, although the average price reduction of 6% remained unchanged from July. Builders of custom homes fared better than spec builders in August, and small, less dense markets outperformed major metro areas.
• The number of single-family housing starts fell 9.9% in July 2026 from June and declined 15.7% year over year. Single-family building permits, a signal of future home-building activity, increased 2.5% in July over June and rose 1.1% compared to July 2025. Single-family starts softened amid an ongoing affordability slump in the US housing market and large inventories of unsold new homes, according to Reuters.
• According to Builder Magazine, consolidation is accelerating in the home builder M&A market as well-capitalized buyers pursue scale, geographic expansion, and long-term growth despite a challenging housing market. Recent multibillion-dollar deals, including Berkshire Hathaway's $8.5 billion acquisition of Taylor Morrison and Sumitomo Forestry's $4.5 billion purchase of Tri Pointe Homes, highlight rising consolidation, public companies going private, and strong demand from Japanese buyers. Industry experts expect acquisitions to remain active as builders seek stronger capital structures and competitive advantages. Japanese firms are increasingly targeting large public builders while retaining existing management teams and brands. The Southeast remains the most attractive region for acquisitions because of its affordability and market size, while builders are also expanding into move-up housing to capture changing buyer demographics.

Industry size & Structure

The average single-family home construction services provider operates out of a single location, employs 6 workers, and generates about $2.4 million annually.

• The single-family home construction services industry consists of about 59,300 firms that employ over 381,400 workers and generate almost $139.9 billion annually.
• The industry is highly fragmented; the top 50 companies account for less than 15% of industry revenue. Most firms serve a limited geographical area.
• About half of firms generate less than $1 million annually and 40.9% generate less than $500,000 annually.