Mold, flooding, defects plague new homes in San Luis Obispo

June 26, 2024


For years, Gina Biegel dreamed of owning her own home. Though the dream would quickly turn into a nightmare after she purchased a new home in San Luis Obispo.

Located across from Laguna lake, San Luis Ranch is advertised as a neighborhood that “embraces the natural relationship between farming and sustainable, healthy living.” The picturesque homes set a few feet from neighbors with walking trails winding behind.

Despite the appearance, many of the homes have serious structural defects including leaking windows, black mold, doors that don’t shut properly, huge holes in walls and flooding issues.

The question is not how did the homes pass inspections, but were the homes inspected?

Before people can move into a new home in California, it is required by law to have a certificate of occupancy. The certificate certifies that a newly constructed residential building has been inspected for compliance with the California Building Standards Code and local ordinances.

While homeowners are not permitted to have utilities turned on in their names without the certificate, this requirement appears to have been waved for the San Luis Ranch development.

Biegel closed on and moved into her home in Dec. 2021. However, her certificate of occupancy was issued by San Luis Obispo’s chief building inspector on Jan. 18, 2022.

Even more concerning is the inspection dates city staff provided. For example, staff reports someone completed a sprinkler and a hydro test at Biegel’s home on Jan. 18, 2022, a day that no one from the city was at her home, Biegel said.

While the city reports Biegel’s home was fire compliant on Jan. 18, she hired an inspector who found mutiple issues including failures to meet fire safety requirements such as having a self closing door to the garage, according to the inspection report.

After Biegel moved in, shoddy workmanship caused leaks in walls and ceilings. Workers came out and cut holes in two walls and a ceiling to repair the leaks, but never came back to fix the walls. In desperation, on Oct. 7, 2022 she filed a lawsuit against Coastal Community Builders and the developer – Presidio.

A search of inspection and final reports on homes in the area show all but one was recorded sold before it received its final inspection, a home owned by a public official.

San Luis Obispo Councilwoman Jan Marx and her husband bought a home two doors down from Biegal. Marx’s home shows a completed final on Jan. 11, 2022 and a Jan. 13, 2022 purchase date. In an odd twist, while other prospective buyers say the one-story style home design purchased by Marx was restricted to low-income buyers, she appears to have paid full price for her home.

Another homeowner in the neighbor, who does not want her name in the article, said issues with mold have destroyed her home and there are currently discussion of tearing down the structure. Her backyard flooded multiple times before she hired a plumber to check her drainage system, which like others in the area consisted of a decorative only drain.

The homeowner has battled with the builder over the defects, and like a handful of residents, is also considering legal remedies.


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What’s a “decorative only drain”? Was it a drain inlet that was not connected to drain piping with a drain outlet?

Another term for it might be fraud — giving the appearance and reassurance of a functioning system. Others might call it window dressing.

If I am reading this correctly, the inspectors from the city never came out? Or if they did, they missed what appear to be blatant problems with the homes and just signed them off anyway? Is anyone going to get fired over this? (Yeah right!) Could the grand jury possibly look into this? This sounds like a major class action lawsuit against the builder and against the city of SLO.

Yes, the city building department should be investigated by the brand newly seated county grand jury that’s the local watch group whose primary job is make sure the government is operating responsibly and effectively. City building department is not and has not been operating responsibly or effectively for decades. It’s a revolving door of liberal city managers, liberal planners. Drain the swamp.

Not operated responsibly for only two decades. When Tom Baasch was the building official it was a tight ship and these things just didn’t happen.

Definitely! The Grand Jury should investigate the city of SLO management and community development department because they are not doing their jobs, enforcing their codes, and falsifying documents.

Also, Jan Marx is a city council member and she is running for re-election yet wants this mess with Gary Grossman swept under the rug. People need to call her out and hold her accountable as a representative of the residents of SLO!

Such a shame to have a beautiful little city besmirched by creeps like these.

Perhaps DA Dow could assign a criminal grand jury to investigate these apparent RICOs (Racketeering Influenced Corrupt Organizations)! It’s within his authority! Definition racketeering: dishonest & fraudulent business dealings.

The city is legally immune from liability and Gary Grossman and Jan Marx bank on this. Inspectors, when they had them, were prevented from enforcing, or were ignorant of, the California Code of Regulations. And it’s not just SLO, Atascadero no longer enforces building codes and I’m not sure if Paso ever has.

It’s the same with all these recent tracts. There’s one in Nipomo that went up so fast it would make your head spin. The framing contractors (mostly from out of the area) come in and knock the boxes together and nothing is plumb or square. I was doing other work out there and spoke with a local door guy, an old-timer, and he was having to fix everything just to get things to work right. And for the prices they ask! Seriously out of balance, if you ask me. But I am not hopeful things will improve, unfortunately.

Building homes in California and making things in China are based on one important factor: you get what you specify and what you pay for.

And, it’s not like many of us tried to tell the city, that the Dalidio property is a flood plain, and formerly a part of the lake marsh, until the dam was built.

Good for growing things, bad for buildings.

Don’t muddy the waters with facts there’s big money to be made.

And so much that’s unseen, too. Structures, whether infrastructure or buildings perched on this kind of geological foundation — sediment — are prone to liquefaction in the event of earthquakes. The current excessive early structural issues indicate issues with settling: oversized stucco cracks and floors and windows not square or on the level. Consider the damage to structures in Oceano structures in a flood plain in the 2004 earthquake with an epicenter 40 miles north. The implications are worrying in the event of seismic activity along the Los Osos Valley Road on which these homes are built.