The nation’s largest builders are getting more dominant, but the group also is getting slightly less top-heavy, the latest Builder 100 shows. Just 100 construction companies accounted for 44.24% of the home closings in 2012, up from 43.98% in 2011. That 44.24% share is the biggest in the Builder 100’s history and reflects continued market consolidation; as recently as 1998, the top 100 figured in only about 27% of all closings.
All told, closings by the Builder 100 (published this month by Builder, a sister title to ProSales) rose 18.4% in 2012 from 2011 to total 167,658 homes. That’s out of 379,000 closings by all builders.
In past years, there was a notable break around the top seven to 10 builders. Lately, however, once you get past the three biggest companies—D.R. Horton, Pulte Group, and Lennar Corp., which collectively account for 13.26% of all closings—the list descends much more gradually down to the top 20 or so. In addition, the top 20 builders’ combined market share slipped from 30.85% in 2011 to 30.71% in 2012, while builders ranked 20th to 50th closed 7.86% of all homes in 2012 compared with 7.74% in 2011, and the share of the total market by the 51st through 100th builders grew to 5.67% from 5.39%.
Builders making the top-100 cutoff in 2012 are significantly smaller operations than those that made the list in the years leading up to housing’s crash. While the smallest on this year’s list closed 319 homes, the No. 100 company in 2005 closed 842 homes. In 2007 the mark to beat dropped to 743, and by 2010 it had fallen to 246 homes.