New Homes, Big Problems

ByELISABETH LEAMY via via logo

Nov. 6, 2006 — -- During the last few years, home builders have been constructing about 2 million brand new houses a year.

Ninety percent of buyers say they're happy with the homes. While that may sound like a huge figure, that means 200,000 customers a year are not happy with the biggest purchase of their lives.

Consumer complaints about builders have gone up more than 50 percent in the past five years, according to the better business bureau.

ABC News' Elizabeth Leamy asked home inspectors to go through some newly built houses and point out what they found wrong.

One Maryland house had drastic structural problems. The contractor shoved the main support beam through the outside wall when he couldn't get it to fit right on the other end.

Inside the house, inspector J.D. Grewell said the entire roof could come crashing down because it was installed wrong.

"This is to the point of let's start over, let's start rebuilding," he said.

Fortunately, the homeowners discovered these life-threatening flaws before the drywall went up and hid them from view.

"It has been a total nightmare," said Dennis Capolongo, owner of the Maryland home. "We are devastated. It has taken away lots of precious time from my family and friends."

Water worries plagued one Virginia house. Ever since it was completed a year and a half ago, the homeowners have heard water trickling "inside" their walls when it rains.

Inspector Ted Collins found large gaps around the windows where they should have been sealed, according to the manufacturer's own instructions. Mold isn't visible, but it's obvious where water has saturated the wall.

"The stains are as plain as day, right here in front of everybody," Collins said.

New Jersey investigators found these kinds of problems -- and worse -- during a two-year long investigation of the home construction industry.

"It is the single largest purchase that most people will make in their life times. It is absolutely devastating to them. We encountered people who have had marriages fall apart over the problems in the home," said Charlotte Gaal of the New Jersey Commission of Investigation.

How does it happen? According to New Jersey's report, local building inspectors often can't -- or don't -- keep up.

"It's not that they got paid off. They just don't even bother," Gaal said.

Plus, more than half the states do not require builders to prove their competence or get a license.

"I don't even think many of them know how to build. I could become a builder in New Jersey tomorrow," said Gaal.

The National Association of Home Builders (NAHB) counters that customers often have unrealistic expectations of a new home.

"This is the real world and there is no such thing as perfect," said the NAHB's Jerry Howard.

The NAHB encourages its members to follow up and fix flaws. Howard says customer satisfaction with new homes has actually been going up over the past decade.

"This is a highly competitive industry. Builders want satisfied customers. Which is why we take such pride as an industry that 80 to 90 percent are happy," he said.

Sander Kelman is not one of the happy customers. His New Jersey house --like about 40 other homes -- was supposed to come with a two-car garage, but it wasn't built big enough to park two cars.

"If we tried, this bumper would be parked over this stair," Kelman said.

Homeowners formed a special association to fight back. It took Kelman seven years to get the builder to expand his garage. Many of his neighbors are still waiting.

Structurally unsound, leaking water, undersized: a small sample of some big problems with new homes.

ABC News Live

ABC News Live

24/7 coverage of breaking news and live events