Oligopoly is the natural state of a mature capitalist market. That state was attained by American home builders after the Great Recession of 2008, in the wake of the crunch caused by a housing financial free-for-all that went into free-fall.
Home builders not on solid financial footing failed when the housing market crumpled in 2008. That left the hardy in a stronger position. Consolidation mergers strengthened builders in local markets.
Facing fewer competitors, builders have been under less pressure to beat out rival projects and could time their projects to produce fewer homes at higher prices. From 2013 to 2017 home prices grew over twice as fast as they would have if the market had been more competitive.
Government corruption abetted the process. “Most of the ordinances and rules under which the county building and zoning departments operate are so convoluted and confusing that they don’t mean anything. The entire system benefits the large developers who pay huge impact fees to the county and strike deals to get a project passed,” confessed developer Justin Pierce.
Andrew Van Dam, “Economists identify an unseen force holding back affordable housing,” The Washington Post (17 October 2019).