$500K house takes its toll - East Valley Tribune: Business

$500K house takes its toll

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Posted: Sunday, June 17, 2007 7:50 am | Updated: 6:12 pm, Fri Oct 7, 2011.

A 25-year veteran of the development business, Gilbert homeowner Anthony Amendola knows how to spot quality construction.

VIDEO: Gilbert homeowner Anthony Amendola describes some of the problems with his house

That’s why he hired Toll Brothers — a national builder he respected — to build his more than $500,000 luxury home in the southeast Valley’s Power Ranch development. But on his first walk-through shortly before the deal was set to close, Amendola realized his dream home was a nightmare. Sinks, cabinets and faucets were missing. Gaping holes surrounded outlets. The electricity wasn’t turned on.

“My reaction was complete disgust,” he said.

Nearly two years later, he still has unresolved issues with the workmanship, and he isn’t alone. Other neighbors in the Toll subdivision have similar complaints. They say Toll is a good company. But some believe the frenzied pace of construction during the housing boom led to shoddy workmanship as builders struggled to find enough qualified laborers to meet demand — a theory industry observers say is likely true in some cases.

America’s largest luxury-home builder, Toll caters to move-up, empty-nester and active-adult home buyers in 22 states. It has more than 20 developments in Arizona with 10,000 to 12,000 homes. Toll has fixed some problems but, neighbors say, not without repeated calls. Toll Brothers takes every complaint it receives seriously and responds in a timely manner, said Linda Hanford, the builder’s southwest marketing director.

“We do strive to resolve everything as best we can,” she said. “We want to maintain our name and reputation.”

Every Toll home has a nine-page inspection list, and each owner is given two walk-throughs before closing.

“We want people to be able to entertain the night they move into their house,” Hanford said.

Before Amendola signed the contract for his roughly 5,700-square-foot home, he spent eight hours inspecting it and counted more than 200 defects. Nearly two years and 14 letters later, he still has a list of 15 problems. In that time, he’s dealt with an upstairs shower that leaked water into the basement, windows that don’t shut properly, a back yard wall with loose concrete blocks and more.

A vice president at Lauth Development in Phoenix, Amendola estimates he’s spent more than 380 hours inspecting his home and dealing with Toll — losing the equivalent of $86,000 or so in work time.

Toll has made repairs, but if you stop calling they disappear again, Amendola said.

Toll’s average time for initial response to complaints is 24 hours, Hanford said. The company has a large number of customer service representatives, who are assigned to and familiar with specific communities, she said. They go to each site, evaluate the problem and schedule subcontractors to do the work.

“Sometimes, you have to respond on multiple occasions to a problem, and, sometimes, that can be spaced out more than the customer might want,” she said.

GROWING FRUSTRATIONS

Since April 2004, Gilbert inspection company Tony Hecht Enterprises has inspected at least 57 Toll homes Valleywide, including 11 in Power Ranch.

Toll isn’t a bad builder, but its homes seem to have more defects than those of other builders, said Hecht, whose company inspected 1,600 to 1,800 homes last year.

At an average size of 4,130 square feet, the Toll homes Hecht has inspected have averaged 61.5 defects. Other similar-sized homes have closer to 49 problems, he said. The number of defects in the Power Ranch homes ranged from 52 to 144.

Hecht recently added a 20 percent surcharge for checking Toll homes because inspections take so much longer than what’s typical.

“It appears that Toll Brothers just does not have their arms wrapped around quality control,” said Hecht, who inspected Amendola’s house.

That is Hecht’s opinion, said Alan Euvrard, vice president of Toll’s Arizona division.

“He makes his living that way,” he said. “I think you need to take everything with a grain of salt.”

Euvrard added that, to his knowledge, all of the Power Ranch complaints, including Amendola’s, have been addressed and taken care of. Amendola, though, says he still has outstanding issues.

For homeowner Brian Eastley, the problem comes down to quality control.

Eastley walked by the construction site of his home daily, finding new issues, such as cracking in the foundation slab and stucco. He addressed those problems with Toll but still faced more when the home was done, including bubbles and trowel marks on walls.

“They’re only as good as the labor they’ve hired,” he said.

CONSTRUCTION FRENZY

During the height of the housing boom, builders were so busy that they couldn’t find enough skilled labor, said John Fioramonti with research firm Hanley Wood Market Intelligence. Job superintendents were spread too thin and many didn’t have experience in mass production, he said.

“It was a real aberrational time in terms of the volume that was going on,” Fioramonti said. “Nobody had a good handle on how to deal with it.”

Supervisors were under horrendous pressure, and most builders weren’t restricting sales, Hecht said. City building inspectors were also overwhelmed, he said.

Gilbert has 18 inspectors who visit home sites a dozen or more times each during construction, spokesman Greg Svelund said. They look at underground work, framing, drywall and other elements.

“It’s a big job for sure,” Svelund said.

Gilbert issues from 300 to 500 new-home permits each month. That translates to about 5,000 annually for the past five years to 10 years, he said.

Inspectors focus on spotting functionality and safety issues versus aesthetics. Cracking in the stucco is common and isn’t necessarily something that’s a code violation, Svelund said.

The boom may have exacerbated the problem, but overall construction quality has been declining for years, said Dean Kashiwagi, a professor at Arizona State University’s Ira A. Fulton School of Engineering.

REGULATING QUALITY

Despite the surge in building in recent years, the Arizona Registrar of Contractors hasn’t seen a corresponding huge increase in homeowner complaints about poor workmanship, said Brian Livingston, legislative and intergovernmental affairs director at the state regulatory agency.

The registrar receives between 11,000 and 13,000 complaints annually.

Builders average three homeowner callbacks for every new home, National Association of Home Builders spokesman David Jaffe said.

Labor shortages during the boom may have resulted in some quality issues but not as a general trend, Jaffe said. Builders who have problems are quick to fix them, he said.

MAKING PROGRESS

Toll homeowner John Kenneally has been glad to see some progress being made in recent weeks on longstanding problems.

He’s battled sink holes in his yard created by water runoff from the roof. Window wells in the basement have also filled with mud when it rained, and water has seeped in through the walls, Kenneally said.

Workers have come out repeatedly to try to fix the problems, though not without the pressure of repeated calls, he said. Kenneally worries that his home’s value may be hurt.

“We’ve had mold, and now I’ll have to fill out a mold disclosure if I go to sell or rent the house,” he said.

Despite his frustrations, Kenneally said he loves the house and believes Toll is a great company. But, for a company like Toll, it shouldn’t have to come to this, he said. “They’re a luxury home builder they should be correcting this up front,” he said.

Toll was originally using an outside warranty firm that wasn’t working, so the builder took over, Euvrard said. Now, it takes workers probably less than a week to get out to homes, he said. “We go back as often as we have to to get it correct,” Euvrard said.

Amendola said the latest supervisor to oversee his home is more responsive. Still, he said he would do things differently if given the chance. “This is supposed to be top of the line,” he said. “For the price that you pay, I would have gone to a custom builder.”

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