America's Large Homebuilders Shift the Cost of Shoddy Construction to Buyers

https://hntrbrk.com/investigations/homebuilders

67 45 25 days ago

gcanyon• 25 days ago

This is not new. I just watched a video a few days ago talking about Levittown, built in the post-WWII boom, where the house lots were just big enough to build septic systems for each, given the current state of the ground/drainage. So as the soil compacted/absorbed the output of the houses, and as people installed washing machines, and and as people converted their attics to additional bedrooms (which they were originally told was fine to do) and occupancy/water use went up, hundreds (thousands?) of backyards became soft, smelly swamps. Eventually the whole neighborhood had to switch to sewers, at enormous expense.

bayarearefugee• 25 days ago

This is not new.

Nothing under the sun is new, but we do currently live in a time with unprecedented levels of open corruption where nobody seems to feel the slightest amount of guilt for clearly immoral behavior as long as they get away with it.

And even in cases where what you do is explicitly illegal legal enforcement is largely contingent on whether or not whatever corrupt thing you did made you rich enough to pay the Get Out of Jail tax.

HFguy• 25 days ago

I suspect it is higher than it was 20 years ago and significantly lower than it was 100 years ago.

margalabargala2• 25 days ago

unprecedented levels of open corruption where nobody seems to feel the slightest amount of guilt as long as they get away with it.

Historically speaking, current levels of corruption in most of the world are either low, or completely precedented.

In the US specifically, corruption may be higher the last decade than in the couple of decades precloud, but certainly is not as high as 120 years ago.

roysting• 25 days ago

For additional context; Levittown(s) were named by William Levitt the guy that is considered the creator/initiator of the archetypal suburb concept that would become one of the biggest destructive forces and cause of endless misery in American society.

They were the very basis of the subject fraud too, the incremental, cascading slide and destruction of quality through fraud, even if it took time for the incremental, “salami slicing” to get to this point where contacted, foreign national, fly by night operations underlying all the corporate builders are throwing together what in some cases are literal paper houses where even OSB sheathing has been replaced by what can only be called fancy cardboard.

lolpython• 25 days ago

For anyone who wants to see clear examples of these defects from an inspectors point of view… For a while I was completely addicted to watching inspection videos of brand new homes where the inspector shows poor craftsmanship and sometimes even dangerous defects - the best in the genre IMO is Cy https://youtube.com/@cyfyhomeinspections?si=zldoP3BpzK6mUzDc check out his YT shorts. Example after example of terrible defects in brand new homes in Arizona

bagels2• 25 days ago

It's shocking how poorly built these houses are. No insulation, broken roof trusses, gas leaks, concrete property walls falling over.

It's not like houses were always perfect in the past though. My 1953 house has construction debris mixed in to the concrete foundation in the corner of the garage, where I assume they ran out of concrete, and knots in the roof planks patched with garbage as well.

thehoff• 25 days ago

Sure maybe they weren't perfect in the past but were they this expensive (compared to income)? In the Cy videos I can't believe how much some of the homes cost and the things he finds wrong.

htrp• 25 days ago

“You have to start value-engineering every component of the home, which means making compromises, not in quality, but in the way that you actually configure the homes,” Lennar CEO Stuart Miller said in an interview with Bloomberg Television last year.
D.R. Horton similarly promised its investors it would find ways to cut costs, like “replacing certain high quality fixtures and finishes with less expensive yet still high-quality fixtures and finishes.”

Enshittification to the max

mlinhares• 25 days ago

No wonder everyone knows Lennar build quality is terrible everywhere.

dghlsakjg• 25 days ago

From the publisher:

We generate revenue in two ways:

1) Litigation. We may partner with litigation firms that bring cases empowered by the facts our reporting uncovers, aimed at getting restitution for people who have been harmed. Relevant litigation deals are disclosed in our articles.

2) Investment. When our reporting does not include Material Non-Public Information (“insider info”), we may share it with our affiliated fund. Relevant investments are disclosed in our articles.

- end quote

Not saying that these complaints aren’t valid, but this is PR dressed up as reportage by a short seller/litigation investor.

ajcp2• 25 days ago

100%

While I have no doubt these complaints are real this feels like it's trying to gin up evidence for a position more than anything

SubiculumCode3• 25 days ago

I bought a home a few years ago. We chose an older 1940's wood home near downtown in a California town. Its solid. Meanwhile, friends of ours have bought newly constructed homes with all the modern features, and the horror stories they have...

topgrain22• 25 days ago

It’s tricky. Buy 1970s or earlier and risk asbestos and lead issues (look how late asbestos was still used in a few things! It’s surprisingly late). Buy later than about 1985 and all the good old-growth wood was gone so it all sucks in different ways.

SubiculumCode3• 25 days ago

This is true. Luckily my house has gone through a lot of rewiring prior, but yes there are definitely issues to watch out for.

pfannkuchen• 25 days ago

Was it actually gone or did the remaining stock get some sort of protection? Like did the entire continent seriously get logged?

matheusmoreira• 25 days ago

I wonder what exactly about the 1940's home made it solid. I want to build my own home one day, and I don't want it to fall apart the minute the builder's liability expires.

ajcp2• 25 days ago

It's not more solid, it's just had 80 years of corrections.

SubiculumCode3• 25 days ago

Old growth wood is denser and stronger than new growth wood. Once we stopped cutting down old forests for lumber (generally a good thing), wood became a bit shit.

OgsyedIE• 25 days ago

Companies enshittify in every sector to meet growth targets, and if you believe Bernanke the pressures on growth targets come from the global investment market struggling to find enough places to invest, but where does the undersupply of places to invest come from?

Is it just a civilization-wide structural incentive to overbuild investment capital relative to uses for it or is there a structural cause for inadequate quantities of reliable investment sinks?

FireBeyond• 25 days ago

Wouldn't surprise me. I live on a small loop that had a vacant lot next door to me (home burned down in the 80s shortly after construction and had stayed vacant until 3 years ago).

One of the big name builders in our county bought the land (we had only just bought our home next door and wish we had been in a position to buy the land) and through up the usual cubical blob with no eaves, no personality, and maximum possible square foot.

It's been three years and not two-three months has gone by without contractors being there to repair damage... fix the fence, fix the foundation, lift the foundation, repair drywall cracks, repair sagging floor, fix HVAC issues. All for the bargain basement price of $600K "builder grade" (Hah, once upon a time I was naive enough to think this meant high-end, not "cheapest shit that will pass code").

rawgabbit• 25 days ago

Please name names.

Cyclone_• 25 days ago

I recently bought a home built by Lennar. The project manager kept telling me up until closing about how great the warranty was. He said that the drywall in the hallway going to the basement was going to be finished. When I reported this to the person who handled the warranty he said that the basement wasn't going to be finished. I reported some issues with the cabinets and he said they wouldn't fix it until the 11 month period since he said other things could break until then. He also tried to discourage me from getting an 11 month inspection. When I moved in the grass was almost a foot long and there was a vole infestation in the backyard due to the grass being long. Whenever someone talks about how there is a warranty I usually chuckle a little. The companies know how much it would cost you to sue them.

To be clear small builders have done things far worse in Minnesota. There's a builder on the South side of the Twin Cities that has left many homes with foundation issues. They're no longer in business. My issues look tiny compared to theirs.

AnimalMuppet• 25 days ago

Hmm. We (many of us, anyway) keep saying that the solution to housing shortages is to build more homes. But if they're going to be built badly, that somewhat lessens the value of that approach as a solution.

bob1029• 25 days ago

I've owned a range of 21st century construction in Texas. 2023, 2021, 2012 (current), 2009. The one built in 09 is easily the best out of the bunch. I'm currently looking at homes built in the 70s and 80s.

I've learned my lesson about cheap builds with 13 foot ceilings and gigantic rooms. I am over the scale of it all because the acoustics are so goddamned awful you can hardly sleep. Not one of these houses will ever have interior insulation or god forbid actual Rockwool installed anywhere, so the rooms resonate at frequencies that are impossible to mitigate. 13' ceilings have an axial room mode of ~43hz. Good luck mitigating that. Oftentimes the master bedroom has a dimension even larger than this. Your audio system might be tuned to avoid these ranges but traffic noise and the way the hvac system rumbles in your crawl space is much harder to. Pushing into infrasonic is only a viable option when you have an entire stadium at your disposal. This in between realm is awful. The inside of a Walmart feels better acoustically than many of the new homes built around it.

I am looking forward to having 9 foot ceilings and thick-ass brick all the way around again. I'll lose about a thousand sqft of living space and have to deal with all kinds of legacy issues, but at least it's built better.

SilverElfin• 25 days ago

Almost all new homes in the last 20 years are terrible. Every builder cuts corners. Inspections often can’t see where those savings were made. And insurance or warranties won’t help for many of them. It’s a huge scam and needs legislation.

tristor• 25 days ago

My experience as a homeowner with relatives in the construction trades is that any tract home / production builder will be equally shoddy. They don't need to be a large publicly traded company like Lennar, DR Horton, or KB Homes to do a terrible job, they just need the wrong incentive structure coupled with no enforcement of quality standards.

Realistically the only way to get a properly built house in the United States is to have a reputable custom home builder do the job, invest heavily in things like engineering up front to minimize geotechnical issues or structural issues that might arise later due to poor homesite choice or architect artistic overreach. That, or buy a well-built home that's already there from before we went fully into production building, which is really just houses made from around 1970 to 1995, before 1970 we were slapping up badly made houses to deal with the postwar boom and after 1995 we went fully into the corporate enshittification hellscape that we currently exist in.

Never, ever, skip an inspection, even on a brand new house, in fact that goes double for a brand new house.

defrost2• 25 days ago

Locally (rural Western Australia) we've faced the same shortage of builders relative to demand that many places have and new builds have increased in number while still falling short of demand.

Traditionally this state near the capital city has had a lot of double brick builds, more so than other parts of the world - due to a combination of the "right" soils and a long standing still expanding massive brick company (Midland Brick).

The greatest growth in "alternative" building has been in the factory built modular home area - not just dumpy dongars and demountable shipping container like homes, but multi part slide together modules that together make up a large "pre built home" - say, four large oversize truck loads each with a complete foundation (thick concrete floor) framed, walled, roofed, plumbed and wired chunk o'house that gets lowered slid and jacked in place, then all parts are pulled into together to make a seamless appearing whole.

It's a day to land, a second day to hook up to septic + water + power and drop verandahs and shading in place attached to the home.

That approach has seen a rapid increase in build time as the chunk parts are all created in large warehouse spaces with overhead crane rigs and racks of supply chain parts allowing multiple home builds to be interwoven in a pipeline that concentrates tradesmen and allows (say) an electrician to pull and plate several partial homes in a day or two.

The build quality (so far, from several I've seen) has been consistently up to code with a significant time and money cost saving to owner over other build methods.

codelikeawolf5• 25 days ago

I feel like shoddy construction/craftsmanship isn't limited to new home construction. My wife and I just wrapped up a 6 month renovation of a >100 year old house. I used to work in industrial maintenance, so I knew how to do a lot of stuff already (electric, natural gas lines, drain lines, etc.) We had to farm out a couple of jobs to contractors we didn't have time to do ourselves. With the exception of one guy, they all did horrible work. I actually had to redo some of the work the plumber did. I was so disheartened with the quality that I decided I was going to just do everything myself from now on. I realized even if I read a book about how to do it and watched a few YouTube videos, I could do better.

I really don't think it's a skill issue, because these people knew what they were doing. It just feels like nobody gives a sh*t. If I bend a piece of conduit that's in a visible part of my basement and it's crooked or off, I'll take it down and re-bend it. If I install a piece of base trim and there's a huge gap between pieces, I'll cut a new piece. There's no attention to detail, and I am _willing to pay extra_ for that. Charge me for the extra conduit or base trim.

I've actually entertained the idea of starting my own electrical contractor company and hiring/training ex-software engineers. I feel like we as a profession generally don't like sloppiness and most of us are nitpicky enough (myself included) to produce quality work. I can't be the only one out there that's happy to pay a little extra if they know they're not getting garbage.

thr0w• 25 days ago

I feel like we as a profession generally don't like sloppiness

Thanks for that, needed a deep guttural laugh.

ruicraveiro• 25 days ago

He was referring to software engineers, not vibe coders.

codelikeawolf5• 24 days ago

I was speaking from my own experience. I feel like we are generally required to _accept_ sloppiness given certain circumstances, but I have never worked with an engineer that actually _likes_ sloppiness. How cool would it be if you were given the freedom to do your highest quality work?

alexgaribay• 25 days ago

I’ve renovated many parts of my house myself. I hired out 1 time to a contractor and regretted doing so. Similar to your sentiment, I feel contractors don’t have the same care as I do. I’ve come to the realization that no one else will put in the same care as I would nor care about the small details as I would.

Also similar to you, I feel I could become a licensed electrician and start that as my fallback career.

codelikeawolf5• 24 days ago

If you ever decide to switch careers, please reach out! We're living in weird times and it's nice to know there's other folks out there exploring similar options.

phil21• 25 days ago

I can't be the only one out there that's happy to pay a little extra if they know they're not getting garbage.

Not the only one, but there is just not a large market for it. And it likely would not be a “little” extra either.

I’ve tried to find local contractors who will just take pride in their work and get it done right (or overkill I suppose by my standards) the first time. Even old mainstays that are regularly double the cost of everyone else have been slipping lately. Companies I used to single bid for jobs knowing I was overpaying but didn’t care since I didn’t have to come behind them to audit or fix anything. They have all devolved.

There is a market at the very high end for ultra wealthy folks at something like 4-8x regular contractor rates. I’ve seen a few friends engage such folks. Most of that is in overpaying for a GC to manage their network of above average contractors and have the budget to make things right if one messes up.

Such companies seem to have zero interest in jobs not in the low 7 figures.

I would pay at least double “market” rate if I could find an electric contractor willing to take on my “crazy” home solar and battery backup project. The problem is the market for people willing to overpay for commercial quality work that will never have a dream of paying their costs back in solar savings is effectively zero. So goes for everything these days.

That said I just had my floors refinished and the contractors we lucked into finding for that 2 week job went above and beyond even my level of attention to detail. They were not any more expensive than competing bids. So who knows. It’s a crapshoot.

codelikeawolf5• 24 days ago

That said I just had my floors refinished and the contractors we lucked into finding for that 2 week job went above and beyond even my level of attention to detail.

It's funny you mention this, because I also have generally had good luck with flooring contractors.

I’ve tried to find local contractors who will just take pride in their work and get it done right (or overkill I suppose by my standards) the first time. Even old mainstays that are regularly double the cost of everyone else have been slipping lately. Companies I used to single bid for jobs knowing I was overpaying but didn’t care since I didn’t have to come behind them to audit or fix anything. They have all devolved.

You nailed it. I think most of the higher bid folks these days are deliberately quoting an inflated price because they either don't want to do the job or are trying to charge commercial rates. I'm sure the commercial jobs are much more lucrative and you won't get people complaining about a crooked pipe. They generally don't care, as long as everything works

AngryData• 25 days ago

Its a race to the bottom in a lot of trade jobs and why a lot of people who are skilled and attention detailed left trades if they can't get into a union. It is hard to compete doing a good job when they guys who do a crappy job out number them and will bid on the same jobs making the same claims that they are skilled and good. But only after the money is spent do people find out whether the guy they hired can back those claims up. And even if they do more have money to fix it later with a different guy, the botch job made the fix even harder and they usually have less money to spend to fix it.

codelikeawolf5• 24 days ago

Yeah this is a totally fair point. I suppose it's indicative of a greater trend I've been noticing as the years have gone by: standards have lowered because the highest quality work has become prohibitively expensive. But the thing that bothers me with the trades is that it doesn't actually _cost_ that much more to do a better job. I don't really know what the solution is, because it seems like this is societal. When I was an industrial electrician, the quality of my work was unaffected by my hourly rate. I took pride in what I did, I wanted to be good at it, and I strived for quality because it made me feel good to do a good job. I still feel that way about what I do. I guess I'm a little bummed out that it's hard to find people like that, especially since I'm willing to compensate them appropriately.

raincom• 24 days ago

It is like consulting/offshoring business: one competent person, with 10 underlings who can add 80 billable hours a day. That's what happened to trades too: one really competent with many underlings.

America's Large Homebuilders Shift the Cost of Shoddy Construction to Buyers

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