PA: First-time homebuyers stuck with leaky townhouses

By Deborah Goonan, Independent American Communities


Ah, the American Dream. Brand new homes in a trendy location of the city, just right for two young professionals who want to be close to everything Philadelphia has to offer. What could be better?

Unfortunately, shortly after moving in, buckets of water started pouring into their homes every time it rained.

One of my readers forwarded the following Fox 29 News investigation to me. In the video, you’ll hear from first-time homeowners Graham Palusky and Justin Fenerty, both of Philadelphia. They recently purchased new townhouses on Dickinson Avenue in the city.


Fox 29 Investigates: I-Team Developer Fight


The worst part is, neither the builder, Anthony Valenti of Design Builders, nor the developer, Joseph Ruggiero, will take full responsibility to fix the problems. Developer Ruggiero blames Valenti, who is supposed to make repairs under the warranty. Valenti claims Ruggiero owes him money, so he’s not about to do any more work on the properties. That leaves two young men stuck in the middle, with nowhere to go for help.

Both have filed legal complaints and have hired private engineers to inspect their homes. Repairs for Fenerty’s and Palusky’s home are estimated at $50,000 to $100,000, respectively.

That’s not exactly small change, especially for two young adults just starting to establish themselves.


What’s ahead for homeowners? 

The problem is, construction defect litigation can drag on for years. Because these cases tend to be complex, legal fees can be substantial, eating into any settlement eventually reached between disputing parties.

That is, if there is a trial. There could be a Mandatory Binding Arbitration clause hidden in the sales agreement or the home warranty. With Arbitration, there might be a quicker settlement, but it will likely be minimal, and come with a gag order to make it difficult for future home buyers to weed out problem home builders.



In search of accountability

Notice how Valenti shifts the blame to subcontractors hired to do the actual work of building homes. Well, Valenti, aren’t you supposed to be supervising contractors and subcontractors?

The big mystery is how did these defects escape detection by the City’s inspectors? You would think they’d notice gaping holes and points for water intrusion.

Problems were not prevented or detected early, and now the homeowners are stuck.

Fenerty has filed a complaint with the Attorney General’s Office. Unfortunately, that will probably go nowhere, because there is very little consumer protection on the books for homeowners.

And what’s outrageous is that Valenti continues to build dozens of new houses in the same general area. You would think that the City would issue a stop work order on builders such as Valenti, and suspend construction and occupancy permits issued to noncooperative developers like Ruggiero.

That would get their attention. And it would likely prevent the sale of leaky houses to future home buyers.

Shouldn’t that be the goal?



2 thoughts on “PA: First-time homebuyers stuck with leaky townhouses

  1. To give you some persepctive on why consumers cannot rely on building code inspections, check out this report from Florida, with regard to literally thousands of homes adversely affected by defective stucco applications.

    Read down the article a bit, and you’ll see that during the building boom, local governments did not hire enough inspectors. In fact, those inspectors were not even inspecting stucco at the time! And to make matters worse, the state of FL allows a developer’s own private contractors did the inspections!
    “Goldsbury [Chief of Jacksonville Building Inspection Division] says there’s little he can do to fix ongoing stucco problems. Although he personally signs each certificate of occupancy, indicating a house has passed all required inspections, he notes that those seven inspections are often conducted by private consultants, hired by the homebuilder — a seemingly conflicted arrangement that is nonetheless allowed by state law.”

  2. American housing is a disgrace. Just about every jurisdiction requires permits. These permits cost money, the cost is passed on to the consumer. Shouldn’t consumers expect some level of protection from their local governments? Don’t local governments have have building inspectors on staff who inspect the buildings to ensure that the work is being done properly? Are they doing their jobs or are they incompetent too? It looks like a whole string of failures that culminate in a huge a mess for the homeowner to clean up. American housing consumers deserve better.

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