The residential construction industry is a critical component of the American economy in that homes of some type are required for everyone, and the home is the single largest purchase that most consumers make. The residential construction industry provides jobs for a variety of workers of varying skills and educational levels, and serves as an indicator of how the economy as a whole is performing. At this point, the industry continues to be made up of small companies, no single one of which dominates, although recent years have seen an increase in the number of mergers and acquisitions within the industry and some builders are found in multiple geographic markets. Future expansion is likely to continue in those areas which are seen economic progress, and changes in technology are likely to result in more efficient and economical materials being used.
The residential construction industry is one of the largest industries in the nation with considerable direct and indirect employment influence. The residential construction industry includes builders of single-family homes, condominiums and townhouses, apartments, and custom builders, as well as the many subcontractors who actually complete the work (Kennedy, 1996, p.รก27). The majority of individuals living in the United States live in dwellings built by this industry (a small minority live in hotels while an even smaller group build their own homes), and a population that has been steadily increasing requires a steady increase in the supply of homes.
There are two markets targeted by the residential construction industry, and these can be further segmented. The first market is the corporate market. Corporations who will then manage the units and realize the rent may contract apartment buildings, or they might be built first and then sold to investors who then undertake the task of renting and managing the units. The second market, and the market with which this research ...