It’s a rare home builder who doesn’t claim to offer a quality product. But the definition of “quality” is changing, and there will be real costs for builders who don’t keep up.

Legislation is making building codes tougher and energy standards higher. In fact, Energy Star Version 3 kicks in January 2012. Plus, insurance companies want to see better risk management from their builder clients. And with plenty of other options in the market to choose from, home buyers’ expectations are going up.

Meanwhile, quality issues may be cutting into your organization’s bottom line more than you realize. A Rodchua 2009 study of 63 manufacturing companies found that 70 to 80 percent of an organization’s cost of delivering quality is spent on failures (cited in NAHB Research Center’s “The Economics of Quality,” 2010). Home builders are no different. In fact, because “manufacturing” is subbed out to trade contractors instead of taking place in a controlled factory environment, it’s even more difficult to ensure a quality product.

The Real Cost of Poor Quality

The same study showed small to medium organizations are spending only 11 percent of their quality costs on preventive measures, with 38 percent spent on internal failures and a whopping 42 percent on external ones.

Large organizations are no better off. The study showed they spent just 10 percent of quality costs on preventive measures, with as much as 47 percent going to internal failures and 26 percent to external ones.

Now, let’s put that in context. For builders, preventative measures may involve setting specific quality standards and construction details, documenting them in words and pictures, sharing that information with employees and trades, and backing it all up with in-field or online training and quality inspections. Internal failures, which occur before the home is finished, might include finding out a trade didn’t install flashing on windows in 100 homes. That same issue would be an external failure if those homes were finished and the owners found related water damage months later.

Losses from poor quality include measureable expenses, such as callbacks, diminished referrals, legal costs, and insurance expenses, as well as less-measureable losses, such as lower productivity, weakened brand value, employee turnover, and lost business opportunities.

One way to gain a greater return per house built is through reducing risk, by addressing common problem areas and systemic issues in a proactive way, before they cost you big bucks on remediation and repair. Think about it this way: If your risk percentage is 2.62 (as Rodchua’s study suggests) on a $200,000 house, that’s $524,000 after 100 homes.

We’ve found that the most common quality issues pop up again and again. The five “hot spots” include stucco, insulation, windows, showers and vapor barriers under the slab. All fall under the heading of building durability, and most have to do with controlling water intrusion.

IBACOS recently broadcast a webinar through its Alliance that covered how home builders can reduce their risk in these five problematic areas. The rest of this article addresses each of these areas, including some of the building science behind how certain materials work.

No. 1: Stucco Quality Issues

Stucco presents a wide range of quality issues to builders. Remember, even if you don’t work with stucco, modular stone and direct-applied stone have many of the same issues.

 

Intruding moisture caused severe damage to this stucco wall.

Improper installation led to this stucco delamination.

 

Moisture. As a reservoir cladding, stucco absorbs water, so it should not be in direct contact with landscaping or hardscape surfaces, where capillary action can wick water up the wall assembly. In fact, stucco should be at least 6 to 8 inches from any landscaping. Weep screed detailing is another possible problem. If an installer allows weep screeds to become blocked, or fails to follow code requirements and simply doesn’t put them in, moisture can be trapped behind walls, again resulting in water intrusion, rot, stucco damage, and mold.

Cracking. Quality issues occur with insufficient vertical and horizontal control joints, also called contraction or expansion joints. Stucco cracks are inevitable, but control joints can relieve stresses and limit the extent of this cracking, reducing the potential for costly repairs in the future. Another cause of cracking is under-hydrated stucco. In hot, dry climates, the stucco will require more frequent hydration: up to two to three times a day for four consecutive days. Hydration should occur after every cementitious coat, whether it’s the scratch or the finish.

	More Info
	Looking for more information about stucco? IBACOS has produced a free paper titled Best Practices and Quality Issues in Residential Stucco Application, which can be downloaded here. The company has also posted a step-by-step guide to three-coat stucco finishes on its BuildIQ Toolbelt website.

Finish Quality. Other problems have to do with the appearance of the stucco. If lath is not embedded well, it will show through. If the scratch coat or base coat is not applied to the required thickness, there could be problems with curing, cracking, or long-term durability. If the stucco has not been mixed correctly, it will be weak. And if the stucco is not properly hydrated before paint is applied, the pH of the stucco could cause “paint burning,” resulting in flaking and delamination.

Bottom line: Minor cracks could require several visits to a home, at $300 to $500 per year. Major cracks and delamination could cost $4,000 to repair for a large section; and paint failures and water intrusion repairs, where the sheathing or studs are involved, could come in at $10,000 or more per elevation in some cases.

No. 2: Batt Insulation Quality Issues

Another area where quality often suffers is when installing batt installation. First, the R-value of this insulation in wall cavities is most accurate if the insulation is enclosed on all six sides. So, what goes wrong?

 

The effectiveness of batt insulation is reduced by both overstuffing (top) and leaving gaps.

 

Gaps and Voids. Not completely filling the stud cavity is a common mistake. R-13 is fine for 2x4 studs, but won’t work for 2x6 studs, which are going to require R-19 to fill the entire depth of the cavity. Also, batt insulation in wall cavities needs to be enclosed on all six sides, which means attic knee walls need to be draft-stopped on the back side with a rigid sheathing, and it should be air-sealed. Another common error is not splitting the batt around wiring or piping, or leaving a void behind electrical boxes. In addition, workers often fail to ensure that batts are in complete contact with the subfloor when installed to insulate a floor assembly, such as a room located above an unconditioned garage.

Compression or Overstuffing. Insulation should not be compressed or overstuffed. For example, if an R-13 batt is compressed when installed between 2x4 studs, it will create gaps between the batt and the interior drywall surface. This will lead to increased convection in the cavity, lowering the overall R-value of the wall cavity. Keep in mind that many times, issues with homeowner comfort are not connected with the HVAC system but with improperly installed insulation.

Bottom line: The stakes for proper insulation installation are high. The average removal and replacement cost in floors above unconditioned space is $1,000–$3,000 per home.

No. 3: Window Quality Issues

Installing a window puts a hole in the wall assembly, so it’s important to take proper measures to direct water around it. More than in any other area, small quality control measures can add up for windows. The most common window quality issues all pertain to water management.

Improper Integration with the Drainage Plane. Manufacturers will allow housewrap to be installed after the windows, but it’s better to do it before — it’s the best chance to properly integrate the windows with the drainage plane. The housewrap needs to be wrapped around the window frame opening, preferably using the “inverted martini glass” method (see illustration). Other problems include imperfect laps at the jamb and sill flashing.

 

The “inverted martini glass” method of cutting the housewrap around windows is an industry best practice.

Using too many housewrap fasteners around a window increases the likelihood that water will intrude.

 

Incorrect Fastening/Sealing. Sometimes contractors fail to caulk and nail the bottom flanges and to seal the sill flanges to the housewrap. Another mistake is using too many fasteners — sometimes hundreds! — to apply the housewrap around the window, an error that increases the chances of water intrusion from so many penetrations.

Improper Flashing. Some  shoddy contractors use inappropriate materials, omit sill pans, and even forgo flashing entirely. Window installers need to remember to use flashing at the head and side jambs, and there can be no gaps at the head flashing. Tape needs to adhere thoroughly to the substrate, and it can’t be wrinkled, too short, torn, loose, or insufficiently overlapped with the housewrap. Don’t use asphalt-based materials for flashing or sealing because they can leak through and stain, especially on white vinyl products. Also, ensure that the exterior sills of recessed windows slope toward the outside.

Bottom line: Any of these failures can cause damage to the window unit itself, from rot to water damage, and replacing windows is incredibly costly. The total cost of window quality issues varies according to the cladding used: stucco averages $10,000 per side of home, while vinyl siding averages $3,000 per home.

Be aware that water intrusion can also cause mold growth behind wall claddings and inside wall cavities, a problem that often stays hidden until it reaches the interior — and once it’s there, costs can go much higher.

	Learn How
	For more details about on how to properly flash windows, view this IBACOS video on YouTube.

 

No. 4: Shower Quality Issues

Shower systems get a lot of water: the equivalent of a hundred-year’s rain event two or more times per day in your home. So even though showers are inside, they’re even more at risk for water intrusion. Also, showers are evolving, often incorporating shower seats, which is a new risk area for shower quality.

The goals of a good shower installation are to make it well-insulated and watertight, provide effective drainage, and top it off with a clean, consistent finish.

Backer board Selection and Installation. Standard drywall or anything with paper-based facing won’t work — it must be something with water resistance. But even the right kind of backer board cannot be installed cut edge down because it will wick water. The board also needs to be correctly integrated with the shower pan flashing and underlying drainage plane, and board joints should be sealed.

 

Improper backer board installation is a major contributor to moisture penetration behind showers.

A shower pan with integrated lip is one of the easiest ways to create a shower floor that will drain properly.

 

Shower Seat Design. Shower seats have become popular, but can greatly increase the risk of water damage. They need to be installed with a downward slope away from the wall, toward the drain — one-half inch per foot at the frame stage. It’s also best not to use tile; grout joints allow water to migrate underneath the tile and can create long-term water intrusion issues.

Shower Pan Selection and Installation. Simply using a shower pan with a protective lip or end dam at the front can save a lot of headaches by redirecting water inward toward the drain. Ensure shower surround provides solid wood framing as backing for the shower pan. Shower pans also need be flashed properly to wall framing, and weep holes should be free of caulking.

Bottom line: The consequences of bad choices in shower installation can be significant. An improper installation can lead to water damage and mold growth in wall framing and insulation behind the backer board, water damage to the floor framing below the shower (which can also lead to damage to the ceiling assembly below), and mold and mildew behind tile assemblies.

Builders may need to demolish the existing surround of the shower, install water management, and reinstall or repair finishes. All of this can cost more than $20,000 — much more if mold remediation is needed.

No. 5: Quality Issues with Vapor Barriers Under the Slab

Vapor barriers are there to prevent soil gases and moisture from entering through the slab, and they also need to provide a well-prepped surface for flooring. Here are some common issues:

 

An incorrectly installed vapor barrier under this concrete slab allowed moisture to damage the wood flooring.

This vapor barrier does not extend to the edge of the footprint, increasing the likelihood that ground moisture will penetrate into the home.

 

No Coverage. The biggest mistake is not to install a vapor barrier at all.

Inadequate/Inconsistent Coverage. To be effective, vapor barriers need to completely cover the area under the slab, and all seams and penetrations need to be sealed. Don’t skimp on material; use a minimum 10-mil vapor barrier and extend it to the outside edge of the footer. All laps should be 12 inches or more and taped. Install a double layer barrier around all penetrations and tape seams. Details matter. Sloppy taping or lack of detailing the poly can mean the difference between a dry, livable room and a wet, moldy one.

Bottom line: Quality issues with vapor barriers can lead to mold and mildew in the home, with adhesion problems and buckling of finished flooring and efflorescence at grout lines in tile.

Addressing these problems can be extremely costly. It may be necessary to move the homeowner’s belongings — and the homeowner! — to another location while you remove and replace compromised materials, test the slab, touch up your work and finally, move the homeowner back in. This can run around $15,000 for a 1,000-square-foot area. If a vapor barrier wasn’t installed, problems can be ongoing, for the life of the home.

Getting It Right

The first step in improving quality is understanding quality standards and the building science on which they’re founded. Little things can mean the difference between a happy homeowner and a $10,000 repair.

The next step is to develop your organization’s quality standards, then communicate them clearly both internally and to trade partners. That may include through writing, scope of work, pictures, and diagrams for how things should be done in the field.

Quality also means continuous improvement. Beginning an internal construction quality audit program will help, as will regularly having third-party audits.

Taking these steps will improve your organization’s financials, improve your product quality, reduce future risk and bring down your insurance rates. Plus, if you can control quality, you’ll be in a better position if and when your organization makes the move to high performance homebuilding.

Anthony Grisolia is the expert services manager for IBACOS, which provides technical and business management expertise to production home builders and manufacturers in three key areas: quality assurance, risk management, and performance coaching. Grisolia manages consulting activities in all aspects of design and construction. He can be reached at agrisolia@ibacos.com.