Tract Builders and Production Builders

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This guide is the culmination of knowledge of several attorneys, architects, and new home builders. Until recently, the main author, Lawrence Thomas, worked for one of the largest home production and tract builders in the country. Lawrence shares knowledge he gained the hard way: Dealing with hundreds of angry homeowners while managing the warranty department for one of the country's largest home builders.

The original idea for this guide came from one of the authors who left the home production and tract builder industry in 1999 because of the terrible changes he began to see. He was disheartened that the rapid growth in new home sales came at the expense of quality construction and customer satisfaction.

In the last ten years, relatively small home building companies have grown into giants and the giants have merged into mega-corporations. Today, roughly 70% of new tract and production homes in this country are built by only 7% of the builders (November 2001, Journal of Light Construction). These "production" builders have enjoyed immense prosperity in this boom-time but have had to deal with a shrinking labor pool of qualified contractors.

Strong demand for new homes, mergers in the industry, and a shrinking qualified labor pool have had disastrous results.

Of the 100 or so MAJOR residential building failures we saw in the year 2000, most were houses that were less than three years old! (We define a major failure as one costing more than $50,000 to fix!)

The declining quality in recent years of tract homes and production homes is only one factor in the overall dissatisfaction of new home buyers. When Lawrence headed up the warranty department for a large tract builder, he heard customer complaints about not only the quality of their new home, but the entire home building process they were just forced to endure.

We came to realize that many of the problems customers were having could have been prevented. There was something the customers could have done to protect themselves. The problem was that there was no way for the customer to gain the insider information that they needed about the home-building process. That is what this guide will provide for you.

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