When you're shopping for a new home, your checklist might include square footage, location, finishes, mortgage rate, and school district. But there’s another factor - often overlooked - that could shape your entire buying experience: the builder behind the home.
Why it matters: In today’s market, who builds your home can directly impact everything from price and design options to closing costs, move-in timelines, and even customer service.
Public vs. Private Builders: What’s the Difference?
There are two main types of home builders: public companies, which are traded on stock exchanges, and private companies, which are typically owned by founders or private investors.
Over the past two decades, the market has shifted dramatically. In 2005, public builders were responsible for only 25% of all new home closings. Fast forward to 2024, and that share has more than doubled to 53%.
The shift accelerated after the Great Recession and has picked up in recent years as public home builders have leaned into affordability, offered more quick move-in (QMI) options, and ramped up incentive offerings to attract buyers in the high mortgage rate environment.
This shift isn't just a statistic - it has real implications for buyers.
How Public Builders Can Benefit You
Public home builders have scaled their operations to meet today’s housing demand and economic climate. Here’s what that means for you as a buyer:
More Inventory, More Choices: Public builders often have larger inventories and more quick move-in (QMI) homes, offering flexibility in both timeline and price.
Bigger Incentives: With greater financial resources, public builders are more likely to offer mortgage rate buydowns, closing cost assistance, and other incentives.
Streamlined Buying Experience: Many public companies invest heavily in digital tools and standardized processes, which can make the entire purchase journey smoother and more transparent.
The Value of Private Builders
While public builders dominate in volume, private builders still play a critical role - especially in local markets and custom builds. Buyers working with a private company may enjoy:
More Flexible, Unique Design Options: Private builders often offer more personalized floor plans, design choices, and upgrade options.
A More Personalized Experience: Private builders can deliver a more intimate, one-on-one homebuying experience.
What Does This Mean for Buyers?
“For many consumers, caring about who is building your home is much less important than the neighborhood, design, or price, and that’s perfectly reasonable,” says NewHomeSource chief economist Ali Wolf. “We do, however, recommend doing a little bit of research on the builder you are buying from to help you be more informed and feel more comfortable with the process.”
