Scottsdale’s Taylor Morrison to be 5th Biggest U.S. Builder; Shareholders Approve $2.4B Deal Article originally posted on AZ Central on February 7, 2020 Scottsdale-based Taylor Morrison is about to become the fifth biggest homebuilder in the U.S. Shareholders approved the $2.4 billion deal for the builder to buy California-based competitor William Lyon Homes on Thursday. It’s Taylor Morrison’s second seven-figure acquisition in two years. The builder is growing as demand for new houses, including rentals, hits a 10-year high. Millennial first-time and even second-time buyers looking for affordable homes are fueling a growing share of its sales. Led by CEO Sheryl Palmer, Taylor Morrison has been on an acquisition role. It bought competitor Scottsdale-based AV Homes for $1 billion in 2018. The builder is also a big player buying metro Phoenix land. An executive with another Valley homebuilder recently joked at a housing forecast meeting that he hoped Taylor Morrison would soon turn its buying spree to another part of the U.S. “Taylor Morrison’s growth has been phenomenal to watch,” said housing analyst Jim Belfiore to 1,000 people from the homebuilding industry at his AZ Deal Makers forecast in Phoenix last week. More building but no boom Builders, buyers and investors are more bullish on new homes now because of the extreme shortage of existing houses for sale in metro Phoenix and other growing areas. Housing experts say builders will have to ramp up construction so there are enough homes for new residents. But a repeat of the overbuilding mess of 2005-07 that left tens of thousands of vacant new houses in metro Phoenix isn’t on the drawing board. In 2006, more than 60,000 new houses went up Valley-wide. During 2019, about 22,000 new homes were built in the Phoenix area, and about 23,000 are expected to be constructed this year because of a lack of new home lots available, higher construction costs and a labor shortage. “People are very bullish on homebuilding now, but the market is very different than 10 to 12 years ago,” Palmer said. “The run-up in building in the early 2000s was based on very speculative demand. “We are seeing a very different consumer with a down payment and real mortgage show up now,” she said. Taylor Morrison’s growth spree The deal with William Lyon will make Taylor Morrison the biggest publicly traded homebuilder in Arizona. It will likely be No. 3 in metro Phoenix for new-home sales. Taylor Morrison sold nearly 1,500 homes in metro Phoenix last year in communities spanning from Eastmark in Mesa to Verrado in Buckeye. Some of its most affordable houses start at $226,000 in Goodyear’s Estrella, and prices climb to almost $500,000 at its new community Venture at Black Mountain in Cave Creek.