Stronger Home Warrantees on the Horizon?

More protection for house buyers sought

Brad Shannon

Stymied by the builders lobby a year ago, consumer advocates at the Capitol are taking a new approach to winning warranty protection for homeowners who buy shoddily built homes.

The approach, which Rep. Pat Lantz aired this week in a House Judiciary Committee meeting, builds on legislation already on the books to protect purchasers of condo units. It includes a four- to six-year warranty against defects for single-family homes and duplexes, and it gives builders a chance to "cure" or fix flaws before a buyer can sue.

Sen. Brian Weinstein, the Mercer Island Democrat who had pushed for a law making contractors negligent for shoddy work just as lawyers or doctors are, said he likes the new approach.

"Hers is an easier sell," Weinstein said of Lantz's approach, which might have more political appeal. "The argument is why shouldn't the buyer of a new home have the same rights as the buyer of a condo?"

Lantz was preparing to bring the measure to a critical vote today in the House Judiciary Committee, which she leads. Friday is the deadline for keeping bills alive by passing them out of committee.

Builders who belong to the Building Industry Association of Washington and contractors' insurers are not convinced. They insisted in testimony Tuesday evening on Substitute Senate Bill 6385 that Lantz's amendment could add costs for homebuilders, especially small outfits, while burdening an industry in hard times.

They also questioned whether the legislation tailored in 2004-05 to deal with problems in the condo industry really fit the residential housing market — including requirements for inspections and arbitration, which are costly unless spread out across dozens or hundreds of units, as they are on condo projects.

Olympia builder Daimon Doyle testified that bad contractors make up perhaps 2 percent of the profession.

Doyle said the legislation could have a "devastating effect" on his insurance rates, and Amy Brackbury of BIAW warned it could undo work of several years to bring predictability to the insurance market for builders, driving up rates and home costs.

Using similar arguments, the BIAW and others persuaded House Speaker Frank Chopp, D-Seattle, to kill last year's warranty proposal that could have protected homeowners for up to 10 years for some defects.

Chopp is not saying what approach he will take this time. He referred questions Wednesday to Rep. Mark Ericks, a Bothell Democrat who is pushing for a bill to require a study of the industry and passage of a licensing requirement in 2009 for contractors.

Ericks said he doesn't have an opinion about Lantz's bill but is focused on getting the Senate to pass his measure, House Bill 3349. It would have the Department of Licensing study the need for contractor licensing and bring back recommendations to the Legislature for a bill he is sure would pass in 2009.

Olympia homeowner Karen Veldheer testified Tuesday in favor of the statutory warranty proposal, letting homeowners sue for damages if builders don't correct shoddy work. Veldheer said her family received a builder warranty as part of the sales agreement — "take it or leave it" — but the builder warranty was not helpful for recovering costs of repairs to her water-damaged house foundation in west Olympia.

King County attorney Sandy Levy said most homeowners have no meaningful rights in disputes with builders over construction defects.

"This bill will be very good to good builders, and very detrimental to bad builders," he said.

Levy argued for giving homeowners a longer period to discover major underlying defects such as foundation problems, and he said that if builders want mediation and arbitration to resolve disputes, they should pay for them. He also said he would favor more accountability to home inspectors.

The Olympian, Olympia WA, February 28, 2008