Don’t get me wrong – there’s nothing wrong with “Average” and there’s a distinction to be made between the number of construction defects and the overall quality level of the structure. I’d venture to say that how a builder follows up and resolves complaints has as much to do with their litigation exposure as does their initial quality of workmanship. If the complaint has any merit at all, a builder’s post-sale support and warranty programs can overcome all. As for frivolous complaints there’s almost nothing that can resolve them.

Consider this – the difference between construction costs of “Average” vs “Good” is only about 28%. That’s 28% of the hard costs and the “base profit”, which together account for about 50% or so of the purchase price of a home under current conditions. That’s 14% of the total sale price.

Bressi Ranch has several “communities” that are built mostly by the one builder (who shall remain nameless). If you were to take the bottom 3 communities you’d see minor differences in lot sizes that together MIGHT contribute to about 10% in cost differentials and possibly a half a quality level (Average vs Above Average) or less between them. Put those two components together and they might justify a 20% spread in pricing. But the actual cost vs. price spread is closer to 30% and that spread gets exagerrated as you go up among the communities.

The cores of all the homes in all those communities in Bressi Ranch are of the same materials and they are being built by the same crews. Some of the finish work varies but I’d be downright shocked if someone could prove that any of the finish items were not off-the-shelf items. It’s all being built from stock plans in factories where the builder benefits from the economy of scale. If it costs a homeowner $10,000 to order a single set of cabinets cut to fit their kitchen from Home Depot, a builder who’s ordering 90 sets of that model cabinets for 4 of its projects in the region is getting them for less than 40% of the Home Depot retail price.

You can see the effects of retail pricing from the builders for yourself. Take a tour of the subdivisions being built by the same builders in Riverside County. You’ll see virtually the same models with the same features being sold at half the price. And here’s the kicker – You’ll also see a much more narrow spread in pricing between quality levels out there, a factor which is completely unrelated to the site costs that supposedly make all the difference. Take a look out there and ask yourself if their prices here really are justified or if maybe they’re charging $200k extra just because they can.

Then take a cruise into Olivenhain, which is in eastern Encinitas. You’ll see that it’s possible to get a truly custom built home of Very Good or Excellent quality on a 1+ acre (view) lot, with a pool, in the low $2,000,000 ranges. Compare one of those homes with anything in any of the subdivisions we’re talking about here and see if there’s any reason for a $2,000,000 tract home in Bressi Ranch.