KB Home says that about 140 homes it built have issues with Chinese drywall. The disclosure was made during a conference call conducted by KB Home last Friday to discuss earnings.
Chinese drywall poured into the U.S. between 1999 and 2007 because of the high demand created by the housing boom. Imports accelerated when the rebuilding that followed Hurricane Charley in Florida in 2004, and Hurricane Katrina along the Gulf Coast in 2005, created a drywall shortage. According to The Wall Street Journal, some 500 million pounds of Chinese drywall was imported to the U.S. during the housing boom. That means as many as 100,000 homes throughout the country could have been built with the material.
Gases emitted from Chinese drywall are being blamed for significant property damage, including damage to HVAC systems, smoke detectors, electrical wiring, metal plumbing components, and other household appliances. These gases also produce a sulfurous odor that permeates homes, and cause metals, including air conditioning coils and even jewelry, to corrode. People living with Chinese drywall have also suffered eye, respiratory and sinus problems that may be linked to the gases. So far, the Consumer Products Safety Commission has received 1,311 Chinese drywall complaints from homeowners in 26 states and the District of Columbia.
During Friday’s conference call, KB Home executives said most of its homes reporting drywall problems were located in Florida, and were built between 2006 and 2007. The company said the allegedly defective drywall was installed in homes by subcontractors.
The homebuilder said it estimated that its Chinese drywall repair costs will total about $10 million. It has recorded a charge of $6 million in the third quarter to increase its warranty liability. KB Home said it intended to seek reimbursement from various sources for these costs, but has not yet recorded any amounts for potential recoveries because the matter is still in its early stages.
KB Home is just the latest builder to provide a tally of homes built with potentially defective Chinese drywall. Earlier this year, Miami-based Lennar Homes acknowledged that about 400 homes it built in Florida have issues that could be related to Chinese drywall. WCI Communities, which filed for Chapter 11 bankruptcy protection, has also said 200 of its homes were the subject of drywall complaints. The Florida builder’s bankruptcy plan includes a Chinese Drywall Trust, which WCI will fund with $900,000. That money will help to offset the cost of litigation against insurers and other companies involved in the Chinese drywall disaster. The firm’s reorganization plan was approved in August.
just absolutely amazing what $250k+ will buy you these days…a defective home that can make you and your loved ones sick.
i just purchased a home built by KB Home in 2008 and it would not surprise me in the least if my home was built with this chinese drywall. they have skimped by on everything else in my new home with extreme poor workmanship and materials, why not the drywall, too?
i will be going home this evening and checking out my drywall immediately.
kb homes will pay. lawsuits will be filed and they will pay!!!
We had our AC coil replaced the day we moved in on July 2007 (Our very 1st home). Months ago, while on our 3rd coil we investigated as to why this was happening. We have an inspection on Monday, however KB came out and inspected this past week, and has confirmed we do have the defective Chinese Dry Wall. We find ourselves in a tough situation as we have built friendships with some of the people from KB. However – after reading about their contract from news resources and confirmation of this contract this week – we sought an attorney due to some of their non amended stipulations on their contract for remediation, which includes the following:
-They will only cover the new appliances for 1 year (I believe when we bought the home our appliances had a 2 year warranty)
-They are not responsible for your personal property. If your computer goes (not good for me as I am beginning web design and can not lose my files) or television etc. goes, you are responsible.
These are some of the things that we do not agree with, but most importantly our 2 biggest concerns are:
- What about our health long term.What happens if this is an actual serious health issue?
- The depreciation of our house value. Although the home will be rebuilt, how is this going to affect our selling capabilities when we want to sell?
If you are inspecting your home for signs of this defective drywall, look for the following:(These are the affects it has had on our home)
- Have your AC coils been replaced? Check your AC coil – if there is a black substance on this coil – rub it and see if it rubs off on your finger (Like a soot substance)
-Look at your mirrors, do you notice black at the edge and corners of your mirrors or medicine cabinets? Do you notice black tiny spots on the mirror?
-Look at your faucets, is their a black spotted substance?
-Check your door hinges – are they corroded with a black substance?
- Are your drains in your bath tub turning a greenish black? (No it is not mildew)
- Pull out your refrigerator – open the panel at the bottom. Check the copper wire by rubbing your hand on it. Is their a black soot substance on your finger?
- Remove your outlets – are your copper wires black?
I hope this information helps. Hopefully your home is clean and you do not find yourself in our predicament. Good luck to each of you