America's largest home builders are facing a sharp rise in construction-defect litigation, including high-profile cases that allege mold contamination from improperly built or poorly ventilated homes, the Wall Street Journal reported. Lennar is being sued by the Seminole Tribe of Florida over more than 450 homes that the tribe alleges were built with improperly installed roofs and mold-ridden walls causing health problems. D.R. Horton is defending litigation involving thousands of Louisiana homeowners whose homes allegedly fail to keep out moisture.
Among the named plaintiffs in the Louisiana case is Tabatha Hayden, who told the Journal her D.R. Horton-built home in Slidell developed a mold infestation that specialists attributed to inadequate ventilation and an HVAC system positioned poorly for the region's humidity. Hayden said one of her children developed a sinus condition, another has chronic headaches, and a third has developed skin rashes. D.R. Horton did not respond to WSJ requests for comment. Lennar declined to comment.
Financial filings reflect the trend. D.R. Horton's reserves for legal claims — nearly all of them construction-defect matters — rose 57% to $1.1 billion between fiscal 2022 and fiscal 2025. Lennar's self-insurance reserve climbed 21% in fiscal 2025 to $336.9 million. Builders attribute many defects to subcontractors and characterize the surge as partly driven by aggressive plaintiffs' counsel; homeowners and their attorneys allege cheaper materials, cut corners, and undersupervised trades.