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FOX 13 Investigates: Newly-constructed home buyers find Utah gives them few options to fix defects

Posted at 1:57 PM, Feb 03, 2021
and last updated 2021-02-03 23:45:13-05

SYRACUSE, Utah - About a year ago, David von Adelung, his wife and three children moved into a new $350,000 home in a new community in Syracuse.

“This was the most affordable house that would be in that school zone,” he said.

David, who retired from the Air Force before buying the house, is finishing the basement and replacing a few trims and details he doesn’t like. There’s one thing he can’t fix on his own.

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The windows that extend from the rear of his house are off centered. There’s more roof overhang on one side than on the other.

“To be fair, it is a purely cosmetic issue,” David said, “but it is one that once you see it you can’t unsee it.”

“This was an extra,” he said of the extended window frames. “I paid for this.”

When David filed a warranty claim with his builder seeking a fix or reimbursement, he received no response, he said.

Utah has been one of the fastest-growing states for years. In 2019, municipalities approved permits for 18,000 new single-family homes.

Buyers like David who find problems with the new construction learn “the cards are stacked against the homeowner,” says John Morris, an attorney who has represented Utah homeowners.

“There's a fair chance that when you buy a home in Utah,” Morris said, “and there are problems with that home, you really will have no avenue for recovery. Zero.”

CLICK HERE: Federal Trade Commission guide for new homeowners

Morris says the people who buy new homes usually make mistakes before the purchase. They need to read the contract, he said, and see what the builder or developer will guarantee and what remedies the homeowner has to pursue fixes.

“Homeowners in Utah really need to get an inspection,” he said, “and not the $150 inspection. I would call that inspection worthless, in my opinion.

“You know, whether the outlets work or not or the windows open is not your big problem. You need a more serious inspection, especially of the exterior of the home. That's the critical component because that allows water penetration.”

If your home belongs to a homeowners association, says Deborah Goonan, who lives in northeast Pennsylvania and publishes a blog about HOAs, you need to read the contract to see if you’re responsible for helping fix damage to common areas like pools and private roads.

“So you're going to look for things in that declaration,” Goonan said, “if the developer would require arbitration and not allow.. you to pursue a lawsuit for construction defects.”

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Most newly-built homes come with one-year warranties. If you find defects in that first year, file warranty claims, Morris says.

But the warranty also protects the builder by limiting its responsibilities.

“So the warranty is not the friend of a home, a home purchaser,” Morris said. “The warranty is almost always the enemy.”

David filed warranty claims with his homebuilder, Ivory Homes, for everything from cracked drywall to those off-centered windows. Some things Ivory Homes wouldn’t fix, including those windows.

CLICK HERE: Federal Trade Commission guide on new home warranties

Ivory Homes also wouldn’t replace something that caused David the most concern. When David examined his breaker box, he discovered the breakers were cheaper and didn’t trip as easily as what’s called for in national codes and his own building plans.

David inquired with the Syracuse city building department, whose inspector examined the home prior to issuing the certificate of occupancy. A city spokesman confirmed to FOX 13 that David was told Utah doesn’t require homes be built to certain aspects of the national building codes.

“And I really question how many average citizens know this,” David said. “I didn’t.”

Morris said a homeowner “is delusional” if he or she thinks their home is built to code just because the domicile received an inspection from the city.

CLICK HERE: Federal Trade Commission guide for homeowners seeking repairs

Safety issues like incorrectly installed electrical systems or water seepage can trigger another option for homeowners, Morris says. Utah law gives homeowners six years from when the certificate of occupancy is issued to file a lawsuit against the builder over safety defects.

Those suits can be costly and time consuming for the plaintiffs. Utah limits the ability of such plaintiffs to recoup their attorney fees.

“So if you have a $50,000 problem and you spend $50,000 to get that solved,” Morris said, “you're right where you started.”

Since 2015, Morris has represented a homeowners association in South Jordan’s Daybreak community. That association is suing the developer over what is says was a slew of construction defects that have caused water damage and related problems.

The developers have responded by blaming and filing suit against the project’s subcontractors. Seven years later, there’s still no trial date.

“Once your association becomes involved in litigation,” Goonan said, “it can make it difficult to refinance your mortgage. It can make it difficult to sell your house because that has to be disclosed to a buyer.”

David feels builders are taking undue advantage of a sellers’ market.

“Your average American,” he said, “can’t afford to go to that builder that builds four or five homes a year that actually puts some effort and some quality into what they’re doing. And so where that steers us is to these mass produced homes.”

David didn’t want to sue or move. He wanted reimbursement for his windows.

After inquiries from FOX 13, a manager at Ivory Homes called David.

“He was basically very disappointed that that is something Ivory produced,” David said. “And he wanted to make it right.

“They’re going to take all that stuff back and develop a game plan on how to repair that.”

Ivory Homes issued a statement saying:

“Taking care of our customers during and after building their dream home has led to many second, third and fourth time Ivory home buyers. Our customers have consistently rated their satisfaction at 90% or higher for the past 20+ years.

“Our team has worked diligently to address Mr. von Adelung’s warranty items on his new home. Once management learned of the misalignment with the rear nook, we insisted on fixing this issue once weather conditions allow.

“We will continue to work with Mr. von Adelung until this issue has been addressed.”

The statement added that Ivory Homes offers Utah buyers warranties that exceed what is required by state law.

For new home owners whose builders won’t fix the defects, Morris recommends doing what David did – complain. Threaten the builder with poor online reviews or calling reporters.

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