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Homeowners forced to close on unfinished homes or walk away from deposits

No appliances, no doors, even no running water: New home buyers say they’re being pressured to buy unlivable homes.

MIDDLEBURG, Fla. — The drive from Phoenix with a dog, a cat and a toddler wasn’t easy, but the Comos felt certain the destination would be worth the journey. Their brand-new home was waiting.

“We got a call two days before move-in day that our house was completely done,” Ava Como says. “We just expected to move into a house that had appliances.”

That wasn’t the reality that greeted them Dec. 28. Not only did the house not have a fridge, dishwasher or stove, it had missing doors, missing floors, unpainted walls and innumerable small imperfections.

“I would say it was 60% done at best,” Como says. “Had we known, I would have backed out immediately. There's no way I would have moved my family across the country to come into a situation like this.”

It’s an experience that’s all too common – both in her neighborhood of Seasons at Pine Ridge in Middleburg, and in dozens of communities around the First Coast – where homeowners are reluctantly closing on half-finished homes.

“I see this happening everywhere,” says real estate lawyer Barry Ansbacher, who’s worked in the Northeast Florida market for almost 35 years. “And it appears this issue is getting worse.”

Ansbacher says the red-hot housing market is amplified by very real post-pandemic supply chain and staffing shortages.   

“Whether it's appliances, whether it's lumber, whether it's roofing materials, it is just crazy,” he says. “The supply crisis that everybody's heard about is only getting worse. And that is causing it to be nearly impossible for builders to timely deliver.”

At the same time, mortgage rates are increasing along with the cost of homes. Ansbacher says, “All of that is really creating an environment that, unfortunately, sometimes doesn't bring out the best in people.”

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First Coast News reached out to the Northeast Florida Builder’s association, which confirmed supplies – in particular garage doors – have been tough to obtain. NEFBA Executive Officer Jessie Spradley suggested the push to close may in part be an effort by builders to ensure buyers’ mortgage rate locks don’t expire.  

But homeowners reluctant to close on a half-finished home may feel they have little choice. Many risk forfeiting large deposits, and all face the prospect of re-entering the house hunt at even higher prices and mortgage rates.

Ryan Hamilton, who lives down the street from Como, faced that exact situation. He’d already deposited $17,500 toward his home. Days before closing, he recalls, “we still don't have shelving, we don't have appliances, there's no closets, there's no screen doors, it's a mess, it's not clean, the siding is … not done, there’s no blown insulation in the attic.”

He says despite that, the builder held firm on the March 31 closing date. “He said, ‘If you have Certificate of Occupancy, you're closing.”

“What’s the alternative?” Hamilton wonders. “You lose your $17,500 -- that's not refundable.”

So Hamilton closed. The following day, the project superintendent shut off water to the house, saying he needed to clear debris from the line. Water wasn’t restored for seven days. “I'm either going to Lowe's to use the bathroom, or I'm buying five-gallon jugs of water to flush the toilets, backfill it. I shouldn't have to do that. I own the home.”

Ansbacher says people are often surprised to learn that as long as a home is structurally sound and safe, it can be certified to occupy even if it’s not finished. “A home could get a Certificate of Occupancy with bare concrete floors, no kitchen appliances, no cabinetry and only one working bathroom,” he says. “That's probably not what most people were thinking they were getting with their new home.”

That said, the practice of releasing unfinished homes is new. Ansbacher says previously, builders were reluctant to turn over significantly unfinished homes, to forestall later disputes over the finished product.

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“It’s relatively recently that I have seen builders push people to close when the home is really under any definition, not finished,” he says. “It reflects the builders’ recognition that they really have no idea when that refrigerator or dishwasher or sink is going to come in. And so in order to get that home closed, they're just doing the minimum to get where it can be legally transferred.” He adds, “I don't think it's a preference that the builders have, I just think it's a recognition of, if they really waited till final completion, it might be a month, two months or six months from now before they can really achieve that.”

Pine Ridge residents remain hopeful some of the work will get done at the six-month mark, when the warranty kicks in. For now, they say the project superintendent has stopped responding. 

“He cursed at us. He told us he didn't have time, and that he didn't see what the problem was,” Como says. “It’s the same thing, every single neighbor. Their houses are all in the same state that ours was too. Completely unfinished.”

The superintendent didn’t return calls from First Coast News. Two representatives of Richmond American homes answered calls, but declined comment and hung up.

In response to a follow-up email, the company emailed this: “Richmond American Homes does not comment publicly on individual customer concerns, but we do take them very seriously.”

An hour later, a press release announced that new Richmond American “showhomes” are now open at a new community in St. Johns County, called TrailMark. The email quoted Richmond American Homes Division President Michael Carlo saying, “We believe your home and your home-buying experience should be tailored to your needs and lifestyle.”

Ansbacher says homeowners who are experiencing problems should contact the state Department of Business and Professional Regulation and even the Attorney General to report the builder, but says those who’ve already signed contracts are out of luck.

“It comes down to the words on the paper, not what the marketing materials or what the sales agent says,” Ansbacher says. “And if it's a contract like the hundreds or thousands I’ve seen, they’re going to find if they look at the fine print: ‘Wow, I did agree I would close before it was finished.’”

Ansbacher says more homeowners are going to learn that the hard way -- something Hamilton can literally see coming when he looks out his window.

“They're on to the new homes, working on the homes,” he says. “They're doing work every single day to the homes [under construction], but they can't get people in to actually complete the work.”

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