Exceptionally strong housing demand in the U.S. has large homebuilders in the driver's seat and smaller builders ripe for takeover. The buyers are both domestic and Japanese.

M&A activity in the single-family homebuilder space is having a record year in terms of dollar volume, and close to a record in the number of deals, according to Margaret Whelan, founder of Whelan Advisory and one of the biggest investment bankers in the builder space.