How Much is Too Much?

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Have you noticed the amount of new builds going up? They seem to be sprouting up in every corner of the city! It really makes me wonder where and when the saturation point is? How much is too much? Do we have the appropriate planning to deal with the additional traffic, requirement for services, basic infrastructure with our dated water and sewage systems; and often crumbling roads? Driving through some areas of the city is worse than 4 wheeling down a dirt road through the bush! 

There are new apartment blocks going up, countless new condo developments; and of course more new homes being built than I believe I have ever seen in my lifetime! Where will all the people come from to fill all the housing? What will happen when we simply have more inventory than we do bodies to fill that inventory? How many builders will go bankrupt? I have already heard of a few who have gone bankrupt. Is it not the government’s responsibility to ensure that they control the production and keep it in line with the demand? I understand that the lure of additional tax dollars can be appealing, but what exactly will happen when there are more available homes than people to fill them? Builders and investors can only finance things for so long before they have to take a loss. A loss means they may not be able to pay some of their sub trades, or they will have to lay off employees. This in turn trickles down through the economy until the market has the opportunity to correct itself, which as we’ve seen in the U.S, can takes years. I for one do not want to see neighborhoods in Winnipeg turn into ghost towns with foreclosures everywhere. 

It is possible that we are geared for a new influx of immigration, especially with the economic and political climate in Alberta. Alberta and Saskatchewan have already seen housing values drop by double digits. For years, we’ve seen increases in Manitoba, however, I know very well this cannot last indefinitely. I love this city and sincerely hope the powers at be are thinking long term and not just at the immediate proposed tax benefits.

In the demand to capitalize on the building boom, there are certainly issues with quality control in the build process. I’ve spent the last 20 years in homes all over the city and dealt with houses built in the 1800’s and homes built this year. When building homes becomes a production line to maximize revenue instead of a dedication to a craft as old as time, quality slips. Some of the things we’ve seen in new homes (less than 5 years old) include severe stress cracks caused by ground settling around man-made lakes. Fill and soil are trucked in to build these areas but it takes time to settle; if piles are driven into an area that has not completely settled, according to the Structural Engineer my client hired, pockets of air can cause these areas to settle and effect the supports of the new homes being built. There’s no way you will know whether there will be a problem until one occurs. Try selling a home with structural issues when buyers have so many other homes to choose from. The only one to lose is the Home Owner. 

Earlier this spring, we went into a new build to stage for an out of town investor. We always bring a steamer along for linens and drapery so we had to turn the water on. When I turned the main water valve on in the basement, I always check all plumbing throughout the home, habit after my years in property management. Well this one home had multiple plumbing leaks! One toilet feed line was leaking with a steady stream, I turned off the shut off valve to the feed line and mopped up the water quickly! Another toilet was running constantly! In addition, there was leak in the kitchen sink drain! OMG! Unbelievable!!! All I could do was inform the owner – there was no way they could show the home for sale in that condition.

While we were on location staging another home, cement trucks kept backing onto the corner of the yard and washing out the remains of their cement from their shuts and dumping the cement remnants all over the home owners’ yard. It was a corner lot with forest behind, and the property markers with flags were clearly visible! The truck drivers were well beyond the property markers and clearly on private property! We counted 5 trucks the day we were there! Maybe I’m old school, but I was taught to respect other people’s property, whether they were around or not! Remember the good old golden rule, do unto others as you would have them do unto you. I wonder how happy these guys would be if someone dumped concrete remains all over their back yard? Why in the world was the Development Corp responsible for the area even allowing this? Just speechless! Yes, I took a picture and sent it to the home owner. They had a right to know.

Last week I was asked to provide an estimate for staging a home that was a show home when it was bought a few years back. There is beautiful flooring in the kitchen, unfortunately it has a section where it has all separated and it has gaps no less than ¼ of an inch around each section of laminate!! This was a high quality floor! The only way this could happen was a structural issue or incorrect installation. I expect this from cheap $0.79/laminate not from high end flooring in a new home! We’ve had other cases where clients have wanted to replace carpeting in newer builds and when we pull up the carpet we find all sorts of garage under the carpet or underlay, anything from food wrappers to cigarette butts to just building debris! Really?! No one can take the time to clean before you install the carpet? Speechless!!!! In another case, the stucco is cracking and falling off the rear of another “show home” in a different part of town. The same home has an issue with frost building up inside the bedroom of the lower level. Seems there is an issue with a gap between the top of the foundation and the plate that supports your wood frame construction and attaches it to the concrete foundation. The fully finished space has to be taken apart to the cement to correct the problem….

Building was once a time honored craft. It was done with care, attention to detail and pride. There are many builders who run their businesses on these sound principles and deserve our thanks and your business. However, there are many who are in for the short term because they see the potential to make a buck while the market is hot. Then there are those in between, with good intentions, but not always there to see when someone makes a mistake or cuts corners. If you are dealing with someone who really cares, they will inspect and correct the problem when they determine it was their responsibility. However, I have heard of well-known custom builders who will brush off home owners’ concerns as something minor or somehow “caused by the home owner” until the 1 year warranty period is up, then once the home owner turns to the New Home Warranty Program for assistance, their hands are tied because it is beyond the 1 year warranty period! Strange thing is – it’s always the same builders who do this! I guess it’s part of their customer service “business plan”. This happened with another client of ours, a super nice guy, kept having problems and without seeing it, the builder kept telling him to “try this” then “that” etc. This went on for years until our patient client began to lose patience as he was still having problems. After waiting months for the builder to send someone to inspect a problem, he contacted the New Home Warranty Program a few weeks after his 5 year warranty had expired. Although, it was an issue that would have been covered, they could not help him as the warranty expired. The builder then demanded a retainer of a few thousand dollars for them to send someone out to even inspect the problem. 

My advice to buyers, if possible, pay attention to what’s going on in the development before you buy. Ask to walk through the site on a regular basis if you are custom building or looking for a home in a certain development. Know your warranty expiration dates, and if you are not getting an adequate response to your written concerns with the builder, contact the New Home Warranty Program without delay. A Builder’s responsibility does not stop when you move in, it continues until all terms of the contract have been met and extends throughout the warranty period.

Finally, how much is too much? I already see houses sitting for sale for months and months before a desperate home owner will ask us to stage to help it sell! If we are already seeing people who are feeling desperate with carrying the cost of vacant new builds that are not selling now, what will happen to the market when we add thousands more new vacant homes? When do the planners at the City/Province step in to responsibly allow for moderate growth without saturating a market and sending us into an abyss of vacant unwanted homes?