Single-Family Home Builders
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 58,000 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.
Industry size & Structure
The average single-family home construction services provider operates out of a single location, employs 6-7 workers, and generates between $1 million and $2 million annually.
- The single-family home construction services industry consists of about 58,000 firms that employ over 381,000 workers and generate almost $70 billion annually.
- The industry is highly fragmented; the top 50 companies account for just over 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.
Industry Forecast
Single-Family Home Builders Industry Growth
Recent Developments
Mar 12, 2025 - Home Builders Beef Up Inventories Ahead of Tariffs
- Some home builders are buying up extra lumber, fixtures, appliances, and other materials ahead of Trump administration tariffs, but the strategy could prove risky if high home prices keep buyers away, according to The Wall Street Journal. Some builders are pivoting to less expensive materials or reducing home sizes to offset the potential rise in materials costs brought on by tariffs. Industry observers suggest large home builders are better shielded from tariff-related uncertainty as their size gives them greater buying power to resist price hikes. However, smaller builders are more vulnerable. Building stockpiles of supplies presents risks for builders and distributors if demand dips and they are stuck holding unsold inventory. The National Association of Home Builders estimates that tariffs could increase the cost of building a single-family home by $7,500 to $10,000.
- Trade strife may increase lumber prices, which could pinch home builder margins if higher input costs can’t be passed on to home buyers. On March 1, Trump initiated an investigation into whether US imports of Canadian lumber posed a national security threat, according to The New York Times. The inquiry could enable Trump to enact fresh tariffs on lumber imports from Canada on top of a 25% tariff on all Canadian imports that went into effect on March 4 but was paused for a month two days later for products that are compliant with the United States-Mexico-Canada Agreement (USMCA). The White House claims the US has the resources to be self-sufficient in its lumber needs, but US sawmills can’t compete with imports dumped unfairly on the US market. White House officials said lumber supply is a national security issue because the US military is a significant lumber consumer.
- A lack of affordability in the new single-family home market could reduce demand for homes. In 2025, nearly 75% of US households are unable to afford a median-priced new home, according to the National Association of Home Builders. Given a median new home price of $459,826 and a 30-year mortgage rate of 6.5%, more than 100 million US households are priced out of the market. In 23 US states and Washington DC, more than 80% of households cannot afford a median-priced new home, suggesting a significant discrepancy between home prices and household incomes.
- Raids by Immigration and Customs Enforcement (ICE) are prompting some foreign-born workers to stay home from their workplaces, disrupting key industries that rely on migrant workforces, including construction, according to The Wall Street Journal. The Trump administration has said that while it is focusing on undocumented people with criminal backgrounds, anyone in the country illegally faces increased risk. According to an analysis of US Census Bureau data by the American Immigration Council, undocumented immigrants make up about 14% of the US construction sector’s workforce. The Associated General Contractors of America said it had received anecdotal reports of rising absenteeism from member firms in several locations, including Florida, Georgia, Oklahoma, and Texas. Labor disruptions reduce construction firms’ ability to deliver projects on time.
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