NEW: "House from Hell" Over six months, Hunterbrook interviewed 60+ homeowners across 16 states who bought from America's largest homebuilders—D.R. Horton and Lennar. Their stories reveal a systematic playbook to shift the cost of shoddy construction to buyers, turning dream homes into living nightmares. Hunterbrook Media’s investment affiliate, Hunterbrook... Capital, does not have any positions related to this article at the time of publication. Positions may change at any time. Hunterbrook Media is working with litigators on potential lawsuits based on our investigation. If you are a victim, we invite you to share your story by emailing [email protected] — where we source information for ongoing reporting. Here is what we found:show more

In addition to speaking with dozens of homeowners from $LEN and $DHI, we analyzed contracts, inspected homes with severe defects, reviewed thousands of documents, shopped for homes ourselves, and spoke with construction experts who estimate 100% of new builds have code violations. “There is no bonus for building to code, for quality…Only bonuses for speed and volume." “They always used the cheapest subcontractor, and focused on speed rather than quality.” – a former superintendent, who said they had left “because I do not want my name attached to that kind of work.”

Many of these are major defects. Homeowners told us about: • Sewage flooding from upstairs bathroom through the ceiling downstairs • Structural issues worth $117,000 in repair costs • Mold “just painted over” that sometimes makes their homes unliveable •Foundation cracks, warped joists, moisture intrusions, and roof shingles falling off like “confetti”

THE FINANCIAL MISMATCH: Construction expert estimates typical repair costs: $5,000-$20,000 per home. Builder warranty set-asides: - D.R. Horton: $2,348 per home - Lennar: $3,602 per home The gap? Often, homeowners pay the difference—or live with dangerous defects.

How do builders avoid honoring these warranties? They typically use a step-by-step corporate playbook that allows them to evade liability while pushing the cost of the defects to buyers — mainly by locking buyers into one-sided contracts that severely limit their liability for defects in the homes they sell, while also trying to minimize the buyer’s ability to seek legal recourse. Here's how it works.

THE CORPORATE PLAYBOOK - STEP 1: TRAP BUYERS Rush customers into signing one-sided contracts before they can spot problems: - "Sign right here, right now" high-pressure tactics - No backing out even for major defects like foundation cracks or mold — or even the builder’s failure to get a Certificate of Occupancy - If the buyer tries to hold off on closing to address these defects, it could trigger an automatic default, giving the seller the right to claim the deposit money as liquidated damages in amounts up to 15% of the value of the home. "You receive the crappy home or you lose a substantial amount of money like I did" — Air Force veteran with disabilities

The contracts force buyers to waive basic legal protections guaranteed under common law, like warranties for "habitability"— meaning they don't even promise the home will be livable.

THE PLAYBOOK - STEP 2: Prevent buyers from finding problems and avoid addressing them before move-in: - Discourage third-party inspections ("waste of money") - Limit access to attics, crawl spaces during inspections - Rush final walk-throughs, refuse to document defects - Promise fixes "after closing" that never happen - Legally disclaim any obligation to fix problems identified during inspection (will only fix problems if seller agrees they are problems; buyers can’t delay closing because of seller’s failure to address problems)

Builders can also get creative in avoiding fixes before closing: One D.R. Horton superintendent told a buyer he'd "grab his toolbox from his car" to fix issues while the buyer signed the closing papers—then drove away without fixing anything. Multiple neighbors allegedly got the same "toolbox" lie.

THE PLAYBOOK - STEP 3: Delay, Reject - No response to warranty requests online—never hear back - Constant deflection: problems are "within tolerance" - Blame homeowners for builder defects - Send unqualified crews who make problems worse

Real examples of warranty "service": - Woman with electrical issues told to "reset the breaker"—turns out panel had fire-risk recall - Mold growing through walls dismissed as "just a spot where they missed paint" - $117,000 in structural repairs denied as homeowner "illusion"

Even when repairs happen, they're often so shoddy the problems get worse : "If they attempt to repair something, you're left with three to five new issues. It becomes your full-time job." — Lennar homeowner Subcontractors have zero incentive: "I'm tired of working for free"

STEP 4: RIG THE LEGAL SYSTEM Can't get the builder to resolve your issue? Too bad—you already waived your right to a jury trial, the homebuilders claim. They then force homeowners into private arbitration where: - Builders pick the arbitrators - No public record of proceedings - According to some studies, consumers win in just 9% of arbitrated disputes

Families trapped in unlivable homes: - Leslie Montgomery: Had to live in hotels since county condemned mold-infested home. “My home, along with others in the subdivision, is now being condemned—brand-new, half-million-dollar homes.” - Christie Volkmer: Drinking bottled water, showering in a makeshift camper shower for years due to black slime. “We are hostages in our homes making high mortgage payments to live in a contaminated house” - Ashley Frazier: Back living with parents, after homebuilder refused to fix $467,200 in mold damage. “They were literally only going to replace one square foot of ceiling and a few base cabinets.”

Meanwhile, despite recent setbacks in share price, both companies remain hugely profitable: D.R. Horton: $88,661 gross profit per home Lennar: $95,609 gross profit per home Combined 2024 gross profit: Nearly $16 billion

HOMEOWNERS FIGHT BACK: Desperate families become citizen journalists: - Filing public records requests - Recording conversations with builders - Learning building codes - Warning others on the streets, city council meetings, and social media: 71,800 members across Facebook groups

Some glimmers of hope: South Carolina Supreme Court ruled arbitration clauses "unconscionable" Result: $16.1M settlement for 200+ homebuyers in class action against D.R. Horton.

And hundreds of more lawsuits on the way. – One law firm told Hunterbrook that in South Carolina alone, they've been contacted by around 500 homeowners with complaints — and they’re actively investigating 125 of those cases for potential legal action. – South Carolina county court records show almost half of the 198 complaints filed against D.R. Horton in the last 10 years were filed in just the last two years. - Even in Florida courts, where mandatory arbitration is routinely enforced, the number of lawsuits are spiking.

In response to Hunterbrook’s request for comment, a D.R. Horton spokesperson said in an email, “D.R. Horton is proud to consistently deliver top-quality new homes across the United States, enabling more than 1,100,000 individuals and families to achieve the dream of homeownership since our founding in 1978.” They said the company provides “a robust new home warranty to our homebuyers” and the staff is “fully committed to customer satisfaction and respond to any warranty needs and concerns of our homeowners.” Lennar did not respond to our request for comment.

Hunterbrook wants to hear from homeowners who have been silenced. Reach out at [email protected]. And read the full article at