The construction of multi dwellings is currently a focus of the New Zealand government to address housing shortages. The intention is to build en masse whilst also keeping the buildings affordable. Affordability is not expected to compromise on quality and performance of new builds. New Zealand has a strict regime for building compliance, which helps to maintain standard of building performance. However, despite this, some buildings fail inspection during construction. There is limited understanding on the reasons for such failures. Therefore, this paper aims to provide a clear and concise understanding of why and how residential building inspections fail. The study investigates the reasons behind failed inspections by analyzing 146,000 inspection reports. The report used for the study cover January 2013 till June 2016. The data set was obtained from a major urban council in New Zealand. The results identified two key reasons for failed inspections. One is technical in nature and the other administrative, which both Council and builders must work collaboratively to achieve common compliance objectives. The study provides the construction industry with important insights into the reasons for failure of building inspections to serve as a preventative approach to non-achievement of expected residential building qualities.