 Poorly Built by Pulte, No Different at
Del Webb:
Homeowner Dissatisfaction in Arizona,
Nevada and California
"This report is an important resource for anyone considering the purchase of a newly constructed home. Consumers should educate themselves about warranty coverage when buying a home in case they find construction defects. If these problems are found, consumers should seek assistance from an attorney knowledgeable in these matters as soon as possible."
-Alys Cohen, Staff Attorney, National Consumer Law Center
The year 2008 will live in infamy for home builders.
The Commerce Department reported another plunge in new home sales for December 2008, capping off the worst year since 1982. Bloomfield Hills, Michigan-based Pulte Homes Inc., builder of Pulte, Del Webb and DiVosta brand homes, reported that "slower sales, higher cancellation rates, and increased price discounts and sales incentives to attract buyers" contributed toward net losses in every quarter since the fourth quarter of 2006. The dismal housing market has taken a toll on Pulte's bottom line. Pulte lost $2.3 billion in 2007 and the company reports an additional net loss of $1.5 billion in 2008. Download a pdf of the report  .
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Many factors have contributed to Pulte's financial woes, most outside of its control. However, Pulte bears responsibility for persistent reports of poor construction quality and unsatisfactory customer service. Based on our our surveys, Arizona, Nevada and California Pulte and Del Webb homeowners are dissatisfied with their homes and frustrated by the builder's response to their issues. Investors and home buyers should consider whether Pulte's self-inflicted damage will affect the reputation of its brands beyond any housing market rebound.
Pulte's Junk Debt Isn't the Only "Junk"
The housing market has negatively impacted Pulte's debt rating. Standard & Poor's, Moody's, and Fitch, three major credit rating agencies, unanimously rate Pulte's debt as non-investment grade, better known as "junk." A December 19, 2008 Fitch Ratings report stated how their downgrade of Pulte's debt to junk status reflects negative trends in "operating margins, further deterioration in credit metrics ... and erosion in tangible net worth." Credit raters aren't the only ones giving Pulte a "junk" rating.
"Pulte [filled in] the last half of the subdivision with junk 2x4 homes, destroying our home values. DO NOT TRUST PULTE."
- Pulte "Sheely Farms" homeowner, Phoenix, Arizona
"I will never ever buy another Pulte home nor will I recommend them to my worst enemy!"
- Pulte "Palm Hills" homeowner, Henderson, Nevada
"I spent a lot of money on this house and I don't know if it will last as long as I will. I don't recommend Del Webb or Pulte to anyone."
- Del Webb "Solera at Kern Canyon" homeowner, Bakersfield, California
Problem Jobs, Problem Houses
Building Justice is a partnership that includes the International Union of Painters and Allied Trades, the Sheet Metal Workers International Association and the AFL-CIO.
We suspected Pulte and Del Webb homeowners might be experiencing problems with their homes after speaking with Pulte contractor employees about job conditions at home construction sites. Workers reported unpaid wages and overtime, pressure to work through break periods and bypass safety precautions, sexual harassment and discrimination while on the job. For some workers, appropriate construction materials, safety equipment and potable drinking water wasn't available.
In 2007, 410 Pulte and Del Webb homeowners in Arizona were surveyed by Building Justice. Fifty-nine percent of respondents reported that their home had construction defects.
2008 Survey: 872 Arizona, Nevada and California Families
J.D. Power overrates Pulte and Del Webb homeowner satisfaction. Throughout 2008, Building Justice continued to poll Pulte and Del Webb homeowners. We distributed our survey via direct mail, going door to door and through our web site: www.poorlybuiltbypulte.info. We focused on homeowners in Arizona, Nevada and California since these markets, plus New Mexico, generated 38 percent of Pulte's home sale revenue and 36 percent of unit sales in 2008.
Our homeowner sample includes 872 Pulte or Del Webb homeowners from Arizona (30.7 percent), California (20.4 percent) and Nevada (48.9 percent). Twenty-two percent owned Del Webb homes, 69 percent owned Pulte homes and nine percent declined to state. Ninety percent reported they were the original owners of their home.
Pulte is proud of its position as one of J.D. Power & Associates' highest ranking home builders in its "New-Home Builder Customer Satisfaction Study." In 2008, Pulte brands ranked highest in customer satisfaction among new-home builders in eleven markets. However, only 20 percent of the J.D. Power's survey ranks builders on workmanship and materials. Home buyers shouldn't evaluate construction quality solely on the basis of J.D. Power ranking because it is just one of five factors they consider. This helps explain why home owners themselves paint a much less rosy picture of their satisfaction with Pulte and Del Webb homes.
63% Reported Construction Defects
Sixty-three percent of Pulte and Del Webb homeonwers who participated in our survey reported their homes had construction defects. Taken together, homeowners identified defects with nearly every aspect of home construction: foundation, roofing, electrical, stucco, air conditioning, windows, plumbing, drywall, painting among others.
"I am one of 600 owners in this complex and we all have major defects that are not being addressed or we're just lied to. Lawsuits are being drawn up as I write."
- Pulte "Sierra Canyon" homeowner, Reno, Nevada
"Walls bowed, broken roof tiles, damaged baseboards, sloppy paint on exterior and interior, block wall has many chips and unpainted areas, yard was too low, some rooms are constantly much warmer than others when using AC, no exhaust fan works, windows are very cheap and made poorly, front door sags, cabinets and counter have defects, and many others."
- Pulte "Stetson Valley" homeowner, Phoenix, Arizona
"Foundation has a crack running from one side of the house to the other. Shingles have blown off the roof in high winds. Many cracks in the stucco of the house."
- Del Webb "Sun City Anthem" homeowner, Henderson, Nevada
44% Dissatisfied with Pulte's Response
Nearly half of those Pulte and Del Webb homeowners who reported construction defects were "Dissatisfied" or "Very Dissatisfied" with the company's response to defects they brought to the builder's attention.
"Totally unwilling to deal with major problems. They fixed minor cosmetic complaints but take NO responsibility for major defects. They are not willing to make necessary major repairs to achieve comfort expected in a home sold for over half a million dollars."
- Del Webb "Sun City Anthem" homeowner, Henderson, Nevada
"Lack of initiative or very slow in response time. Had to do multiple follow-ups to have someone come here to fix things. Had a bad experience with one of Pulte's customer representatives. He didn't want to assist in solving my problem and was very arrogant in dealing with my concerns even though the defectiveness was their responsibility."
- Pulte "Rancho Summit Heritage" homeowner, Rancho Cucamonga, California
"They were ordered by Nevada State Contractors Board to fix the house and the uncompacted soil problems at front and back of house. They refused, were fined but never did anything."
- Pulte "Silverstone" homeowner, Las Vegas, Nevada
41% Reported Outstanding Problems
"Their customer service line had been turned off. They never responded to e-mail to their web site for service."
-- Pulte "Solara" homeowner, Beaumont, California
"Pulte counts on wearing you down. I have learned to select the most important confrontations."
- Del Webb "Solera" homeowner, Chandler, Arizona
"Over two years ago, a Pulte representative came to [inspect] the foundation crack. He tore up several tiles, agreed there was a problem and they would fix it. The tiles are still tore up and the house is uninhabitable."
- Del Webb "Sun City Anthem" homeowner, Henderson, Nevada
"No showed multiple appointments, wasting my time. When they did show they never had the equipment to fix the problem. When they fixed the problem, they created two more in its place and the original problem was still present."
- Pulte "West Wing Mountain II" homeowner, Peoria, Arizona
A "Limited Warranty" ... with a lot of limits.
57%
Sought repairs under Pulte's limited warranty. |
40%
"Very Dissatisfied" or "Dissatisfied" with Pulte's response to their warranty claim. |
29%
"Very Satisfied" with Pulte's response to their warranty claim.
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"Many issues had to be brought up multiple times and took a long time to address. During warranty inspections, repairs were ‘forgotten' about on numerous occasions. Repairs were not repaired to my satisfaction."
- Pulte "Copper Basin" homeowner, Queen Creek, Arizona
"A number [of issues] were brought to their attention prior to the warranty expiring. Large settling cracks in stucco; stucco falling off; leaking waterline. Nothing was covered under warranty."
- Del Webb "Aliante" homeowner, North Las Vegas, Nevada
"Any home warranty plan from Pulte is only on paper. They do not honor any part of it."
- Pulte "Stetson Valley" homeowner, Phoenix, Arizona
43% Wouldn't Buy a Pulte or Del Webb Again.
"I would never buy another Pulte built home and have instructed my friends, family and coworkers not to purchase one. On our closing day, I ended up on the phone with Pulte's vice president of sales to express my dissatisfaction with their customer service and their home building procedures. Personally, I feel dissatisfaction is an understatement."
- Pulte "Agua Fria Ranch" homeowner, Youngtown, Arizona
American Dream, or Nightmare?
"This has been a horrible experience. Between all the problems, the non-responsive customer service, the poor ‘fixes', we are very saddened that our ‘dream home' has become a nightmare. It is unfortunate that so many problems have occurred, but even more disappointing that we are left to deal with them, no recourse at all. This house was built very fast, and it is showing over the years. I would NOT recommend a Pulte home to anyone, and I am embarrassed to say that I own one."
- Pulte "Heritage at Tartesso" homeowner, Buckeye, Arizona
"Their attitude is, ‘sue us.' ... The house is unlivable, unrentable, unsalable and the insurance company will not insure it because we are too scared to live in it."
- Pulte "SilverStone Ranch" homeowner, Las Vegas, Nevada
www.poorlybuiltbypulte.info
Our report speaks for itself. Nearly 900 Pulte and Del Webb homeowners from the company's three biggest markets report dissatisfaction. It is time to hold this company accountable for its product. We encourage all Pulte or Del Webb homeowners we to visit: www.poorlybuiltbypulte.info. Share your own stories in our Homeowner's Forum and read what others have experienced. If you are a prospective buyer, we urge you to visit our site to hear directly from existing Pulte and Del Webb homeowners. Don't settle for the stories you hear from Pulte sales agents or realtors working on commission.
In addition, our web site will post the latest news, information about homeowner lawsuits, construction defects scandals as well as links to services across the country where unhappy homeowners can seek relief.
Download a pdf of the report . |
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