Professional Documents
Culture Documents
There are 21 states, including New York, Texas and Pennsylvania, that do not regulate home
builders at all (though some individual cities and counties within those states do). Of those that
regulate, only 19 issue a home builder's license with some kind of testing or work experience as a
requirement. (Both Oregon and Arkansas will start doing so in July.) The other 10 states merely
register home builders as business people, though some do require builders to post a bond. "The
contractor in Montgomery County, Md., fills out the same form as Madam Helena, the palm reader,"
says Jordan Clark, president of the Washington, D.C.-based United Homeowners Association.
Don't count on the home-building industry to police itself, either, if past attempts are any indication.
Consider the Certified Master Builder program, started in 1992 by the Home Builders Association of
Greater Kansas City and touted as "your assurance of quality." In reality, builders who were already
HBA members had only to come up with the $475 fee to earn the designation. A handful of
homeowners disgruntled with their CMB builders sued the program. In October 1998, HBA started
phasing it out. Tim Underwood, HBA's executive vice president, insists "the program did some
good," such as requiring builders to offer a one-year warranty. "There isn't any program," he adds,
"that is going to give everybody 100 percent resolution of every problem."
4. "Public inspectors won't catch my shoddy work."
Max Curtis, a Livermore, Calif., private home inspector, says he hears it all the time from his homebuying clients: "Their builder tells them, 'Why do you need your own inspector? This has been signed
off on by the municipal building department.'" Sure, the public inspector is required to check out
your new house, but only to be sure it is built to code -- -essentially, that it is safe to live in -- -not
that it is well constructed. "They're just looking to see if that wall is up and painted," says Dwayne
Jones, a Memphis builder.
And sometimes they don't even do that well. On one recent inspection, Curtis found 64 items that
the municipal inspector had missed, including a gas water heater lacking flues (without which the
heater may leak poisonous carbon monoxide). "If you don't have your home inspected by your own
person," says Clark, of the United Homeowners Association, "you're crazy."
5. "Your warranty may be worthless."
Many home builders tout 10-year warranties as protection against future problems. But these
warranties are often extremely limited in coverage, particularly after the second year. "It gives
people a false sense of security," says Brent Lemon, a Dallas attorney who represents homebuyers.
"Most of these (warranties) basically require that the house fall down on top of you before they kick
in."
Consider the warranty offered by Aurora, Colo.-based Home Buyers Warranty. It lists 34 exclusions
and, like many warranties, states that the home must be "unsafe, unsanitary or otherwise unlivable"
to get structural-defect coverage. Anne Stark, a Dallas attorney specializing in homebuyer
complaints, did a review in the early 1990s of three years' worth of Home Buyers Warranty's
structural-defect claims and found that 80 percent had been denied. Em Fluhr, the warranty
company's president, says, "If (homebuyers) detect any worsening of the situation, they can submit
another claim."
Accepting a builder's warranty could actually do you harm. Many states, through case law, recognize
implied warranties based on industry standards that provide more protection, says Lemon. Some
builders' warranties usurp that.
more than he deserves," Bob deHoll, an attorney for Pulte, says of what Blackstone got. "We offered
to come back and fix the problems several times."
8. "Your home won't look like the ones we toured."
It's easy to be impressed with the model home your builder shows you. Who wouldn't love the lush
curtains and intricate crown moldings? Too bad the house you buy will look nothing like the model.
Few decorative touches are standard, and builders are notorious for using sneaky design tricks to
make models more attractive, such as putting in scaled-down furniture to make a room look bigger.
Maria Lo Bianco, a buyers' broker in Springfield, Va., admits to playing this game in her previous job
as a builder's marketing executive. "If I know it's a small foyer," she says, "my challenge is to get the
buyer's eye off it so he has no idea how small it is -- until he goes to settlement and can't fit his
furniture. If the dining room is visible from the foyer, I might do an exotic color design there and
leave the foyer plain."
Some practices are flat-out deceitful. Often, builders will plant grass where the driveway would go to
make the lawn look bigger, says Alan Fields, who co-authored Your New House (Windsor Peak
Press), a guide to buying a home. "If you think you're getting the model home," advises Tim Carter, a
builder and syndicated columnist, "you'd better be writing down language in the contract that says
it's going to be exactly like the model."
9. "I haven't budgeted enough for decent light fixtures."
It sounds like a reasonable practice. Rather than specifying every item for the house, a builder will
set cost allowances for things such as light fixtures or carpeting. That way the buyer gets to pick out
what he wants. The trouble is, many builders use allowances as a bidding strategy, low-balling the
cost to keep the total price down and land the contract.
When author Fields and his wife bought their house in 1990, their builder gave them a $500
allowance for all their light fixtures. "We walked into the store and were just floored by the prices,"
he recalls. The couple shopped for discounts, but still had to spend $1,000. Jones, the Memphis
builder, says low-ball allowances are common in his region. He says they usually range from $450 to
$600 for light fixtures in three-bedroom houses when the real bill is more than double that. "And
that's for cookie-cutter fixtures," he adds.
10. "You may wind up seeing double."
It's no surprise that if you buy a tract house, you'll eventually come across a carbon copy, probably
in your own neighborhood. But you don't expect that to happen when you've ponied up for an
"exclusive" design.
That's what happened to Alex Pinchev, president and CEO of software company MainControl Inc. In
1996 he and his wife slapped down $1.6 million for a one-of-a-kind home in tony McLean, Va. The
next year the Pinchevs learned that their builder had used the same design for a home across town
for high-tech big shot Marc Andreessen, co-founder of Netscape. The Pinchevs' architect sued the
builder for stealing the plans. A Fairfax County jury awarded her $140,000 this July. Architects
confirm that originality is not the home-building industry's strong suit. "You see the same things in
Memphis that you see in Atlanta that you see in Washington, D.C.," says Michael Medick, a
Baltimore architect and chairman of the American Institute of Architects' housing committee. "The
big builders are not going to mess with something that's still selling."
http://www.foxnews.com/story/2005/08/29/ten-things-your-home-builder-wont-tell.html