China has seen massive housing development since 1998, when the country abolished its welfare housing system and promoted the development of a market-oriented housing industry (Deng and Chen, 2019). As a result, annual production of new residential area in China increased from 176 million square meters in 1999 to 772 million square meters in 2016 (National Bureau of Statistics, 2017 & 2000). Within this context, the structure of China’s housing development industry also experienced major transformation, with giant national development firms becoming increasingly dominant in the country’s new housing production. This study examines the causes and consequences of this important phenomenon. In particular, it seeks to address three questions. First, what factors are likely to affect the structure of the housing development industry? How did they play out in China? Second, how did China’s housing development industry change in the past two decades and how did those changes take place across different regional housing markets? Third, what might those changes affect local housing markets and the housing affordability challenge many Chinese cities are experiencing today?