Japanese homebuilders are buying up U.S. companies, in a trend that is only accelerating as the U.S. faces a 4.03 million housing shortage.
Since early 2026, three Japanese companies have announced deals to acquire homebuilders, including Sumitomo Forestry Co.’s plan. Ltd. to Tri-Pointe Homes Inc. in a $4.5 billion deal.
The U.S. housing shortage is a prime opportunity for Japan’s companies, which locally face a shrinking population aging out of years spent without buying homes.
“Here in the United States we have a housing shortage of millions of homes, while in Japan these builders would struggle to find buyers,” said Joel Berner, senior economist at Realtor.com®.
“Building homes in America is a ripe business opportunity compared to building homes in some other countries.”
But it’s more than demographics that are driving the acquisitions. Many of these Japanese names have the backing and resources supporting their new American businesses.
Japanese companies are targeting regional homebuilders
In addition to Sumitomo’s plan to acquire Tri-Pointe, the company has also brought in half a dozen regional builders in recent years.
In a separate deal, Stanley Martin Homes, a US homebuilder acquired by Daiwa House in 2017, acquired North Carolina-based United Homes Group a $221 million deal.
Subsequently made a subsidiary of Iida Group Holdings Co. Ltd. known it would acquire Wright Houses in Utah.
In a statement, Iida Group spoke highly of Wright Homes, particularly its regional focus.
“The northern part of Utah Lake, Utah, where WH Group primarily operates, is one of the places in the state where housing demand is quite strong, as it is close to the center of major highways that connect major cities in Utah, making commuting easier,” the statement reads.
“Additionally, Utah, with its high GDP growth rate and much lower unemployment rate than the national average, is expected to see continued strong housing demand, driven by steady migration from other U.S. states.”
During the acquisition process, Sumitomo became the fifth-largest U.S. homebuilder. It has also surpassed Sekisui House, which rose onto the list of largest homebuilders in 2024 when it acquired MDC Holdings, also known as Richmond American Homes, in a $5 billion all-cash deal.
CEO of Sekisui House Yoshihiro Nakai spoke highly of that strategy at the time, arguing that the company “could become a unique entity in the U.S. by combining Japanese and American technologies and, above all, sharing our passion for providing quality housing.”
The number of American homebuilders is declining
Homebuilders cited the fundamentals of the underdeveloped U.S. housing market as a driver for their purchases.
“The company’s Group views business expansion in overseas markets as one of the growth opportunities
The domestic housing market is expected to reach the mature stage of the growth phase against the backdrop of a declining birth rate and an aging population,” Iida Group said in its statement.
Fund manager Hennessy Funds from California also determined that the US housing market offers a lucrative revival. It singled out Sekisui, Sumitomo and Daiwa in particular with potential for “significant” growth. These companies have already set up a manufacturing business for home building products that they can link to American builders.
The U.S. homebuilding industry itself is facing consolidation, with a number of major homebuilders growing in market share. Researchers from Harvard University estimated the number of homebuilders fell by 22% between 2002 and 2017. That meant a loss of almost 19,000 companies.
And now the top 100 homebuilders are responsible for half of all sales, compared to just a third 20 years ago, Harvard found.
Given these trends, Hennessy believes acquisitions are smart for Japanese companies. They can bring technical skills, deep pockets and manufacturing capacity to strengthen America’s businesses. Their integrated structures make purchasing raw materials and access to capital easier for them.
The trend is even stronger amid the economic tumult of recent years. Thanks to rising capital costs, which are hitting smaller builders harder than larger ones, more acquisitions are possible, Berner says.
“The likely targets would be smaller regional builders that are already well established and have made significant land acquisitions: those who are ready to build and are just waiting for a cash injection,” Berner says.
