For the past two years, the M&A sector has burned hot. Slowing organic growth pushed buyers toward acquisitions while favorable market conditions allowed sellers to command attractive valuations. Deals are expected to continue in 2026, though at a more measured pace than in recent years.
“The last two years, I anticipated it was going to be a record year for M&A activity, and it was,” says Margaret Whelan, founder and CEO of Whelan Advisory. “I am not saying that this year. The cream is still going to rise to the top. [In 2026], it’s quality over quantity and sellers have to be much more organized and prepared because of the nature of the uncertainty and the way the business is changing.”
The pace and volume of M&A deals are likely to slow in 2026 due to the absence of certainty in the economy and overall housing market. For many builders, 2025 was a challenging year in which weak consumer confidence impacted demand and price cuts and financing incentives impacted margins. The outlook for 2026 is mixed and it is difficult to assess where the market will be in three to six months time, the average duration for consummating an M&A transaction.
Despite the uncertainty, certain parts of the country and segments of the new-home market remain strong. As such, for companies looking to sell or for companies looking to add to their portfolio, opportunities are available.
“The best sellers are still able to sell and attract incredibly attractive valuations, especially relative to where the publics are trading. The best buyers have plenty of cash, they know where they are, where they want to be, and what they want,” Whelan says.
The M&A market remains skewed toward sellers given the number of potential buyers—public builders, foreign buyers, and private equity firms—though momentum has slowed compared to the past two years. As the larger builders continue to take market share in major markets across the country, through either acquisition or organic growth, it is becoming more difficult for regional private builders to continue to operate. Whelan says it remains a sellers market “for the right seller.”
“We had a rising tide for the past couple years where there was so much interest and so much capital, that even companies with a weaker business model or less history and less proof of concept could sell,” she says. “Buyers are scrutinizing more [now] and the opportunities have to hold up.
“There’s also a disconnect,” Whelan continues. “If the buyer doesn’t feel really strongly about the opportunity, they are not going to pay a high multiple. If the seller doesn’t get a high multiple, they are not going to sell.”
Moving through 2026, Whelan believes the labor market will be the most important indicator that could provide the certainty market is currently lacking. If the job market becomes volatile, more consumers will be unable to qualify for mortgages, regardless of the number that mortgage rates settle at during the year. Greater stability in the labor market could help consumers in the entry-level and move-up segment feel more confident buying a home.
Themes of Recent Years
In addition to the rapid pace of transactions in 2024 and 2025, both years had paradigm-shifting deals for the housing market landscape.
In 2024, Japanese company Sekisui House’s purchase of M.D.C. Holdings, then the 11th largest builder in the country, was the strongest signal of intent for Japanese buyers in the U.S. housing market. Sekisui House initially set a goal of achieving 10,000 annual closings in the U.S. by 2025, but the M.D.C. purchase propelled the company to achieve the goal sooner than expected. Sekisui House’s portfolio of companies (M.D.C. Holdings, Woodside Homes, Holt Homes, Chesmar Homes, and Hubble Homes) ranked 6th on the 2025 Builder 100 list with 14,860 closings. Japanese companies Daiwa House, Sumitomo Forestry, and Misawa Homes Co. have also been active in the M&A market and have lofty growth and volume targets for the U.S. market.
“Asian buyers are looking for the same opportunities as the U.S. publics. However, most of the publicly-traded U.S. builders are going for a land light model,” Whelan says. “If a Japanese buyer comes in, they really like land. They are well-capitalized, they are certain about what they are looking for, they underwrite diligently, and they don’t have a financing contingency.”
In 2025, the purchase of public builder Landsea Homes by private equity-backed private builder New Home Co. signaled both the possibility of future public builder sales and the interest of private equity in the housing market. Following the announcement of the New Home Co.-Landsea merger, public builder United Homes Group explored the possibility of a sale before electing to continue operating “business as usual.” Whelan suggests there are “too many public” builders and that the market share race by the large public builders may result in further consolidation.
Themes for 2026
Moving forward, land banking and market consolidation are expected to continue to influence the M&A space.
The prevalence of land bankers in M&A has increased significantly in the post-pandemic period and is likely to remain elevated as U.S. publics continue to move toward land light operating models. Of the eight transactions facilitated by Whelan Advisory in 2025, five were M&A deals and three were capital raising efforts for builders either looking to refinance or put in new growth capital to finance land development deals.
“We have so many capital providers right now, I feel like capital is a solution looking for a problem. Many of the builders are well-capitalized and have what they need,” Whelan says. “I think there will be more land banking deals. There are so many [land bankers] and they are sharpening their pencils and offering terms that are more attractive.”
The rate of M&A activity in recent years has accelerated market consolidation and left large public builders with greater control of the housing market. The top ten companies on the Builder 100 account for a 45% market share and account for 75% of closings among the top 50 markets on the 2025 Local Leaders list.
Over the past two years, large public builders have expressed a willingness to expand into secondary and tertiary markets to grow their portfolios and achieve early mover advantages. Lennar acquired private builder Rausch Coleman in 2024, expanding its portfolio into new markets in Arkansas, Oklahoma, Kansas, and Missouri. Similarly, Meritage Homes acquired Elliott Homes to add a presence for the builder in Mississippi, Alabama, and the Florida panhandle markets in the Gulf Coast region.
In 2025, Dream Finders Homes acquired Green River Builders to expand its portfolio to the Atlanta metro, Daiwa House-backed Stanley Martin Homes expanded its presence in North Carolina through its acquisition of Windsor Homes, and D.R. Horton grew its market-leading share in Greenville and Spartanburg, South Carolina, by acquiring SK Builders. Southeastern markets remain a target area for builders looking to grow their portfolio and capitalize on economic growth.
“There is absolute growth in Georgia, Florida, and the Carolinas relative to overall [national] growth,” Whelan says. “The market share is available in those markets to make it worthwhile to pay a premium.”
