This is new construction, so I expect it to be perfect. Is it okay for the osb sheathing to come down to the same level of the siding? It would take much rain bouncing up from the ground to give it a good soak, in my opinion. I can tell them to monitor it, but I’m wondering if there is supposed to be a flashing. I can’t even feel a starter strip.
where would You expect the sheathing to be ? If there was no starter strip the siding would be loose at the bottom …
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I agree with Jim…I suppose the osb could be up an inch or less and it could still work. But, if the siding hanging down got banged, it could leave a crease/dent in the starter strip that would transfer to the siding which wouldn’t be good.
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I hope you were being sarcastic 
This made me chuckle.
To answer your question: this is normal, not against code, still a “modern” building standard. OSB is used on “cheaper” builds and it’s “good enough for this neighborhood” material! Yes, with due time, it will rot some… Few, better builders, to overcome this issue will go up 2 feet using PT plywood then the rest standard plywood. If you call this out, you will be thrown under the bus because it’s the way it is done. If everything else is done correctly, this won’t present itself as an issue for decades. At that time the contractors will just tell you it lasted x amount of time… it’s time to upgrade
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Thanks. That’s exactly what I needed to know.
The buyers have been living here a couple months now and decided to now get an inspection since they are having problems.
I would recommend tearing down the house and start over
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Play nice, it was a good and valid question! I can show you a lot of pics with rot in that area. 
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Are you crazy? All they have to do is reinstall the siding. Ha…anyway.
I’ve found rotten bottoms myself many times and the OSB was only even with the bottom of the vinyl in one area. I’ve never installed vinyl siding, so I didn’t know if it was supposed to have a z flashing or not.
that would be a negative ghost rider…
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I was just blowing off some steam, I was installing cedar shingles on an oceanfront house, and I was freezing my ass off and read the post and vented some steam, no biggie I was warming in my truck and thought I would throw a wrench into the works and see what everyone would say, HAHA. 
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Was there any damp proofing on the foundation? I would be more concerned about that considering the patches in the concrete and grass growing up against it. Roots from any vegitation can reak havoc on a foundation in time. The OSB in your pictures are normal and should be fine until a viney weed comes out of the sod and climbs the wall. Next time you are at a home with cheap lap siding or even cement board siding, you will probably see the same thing. …
I’ve done over 1500 inspections, so I see it often. I also see lots of known defects, that are done over and over. Like not backwrapping bottom of the stucco. Sometimes we see the same thing so much since we started inspecting, we assume it’s correct.
Since I’ve seen the bottoms rotten many times before and I’ve never installed vinyl siding, I figured I’d double check it. That’s all.
Thanks everyone!
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Damp proofing the foundation? Just like week I saw the buckets at Lowes, but I honestly never heard of it before. I live in South Louisiana. What’s the purpose for?
Hi Jesse. Seems to be a little devilish humor in this thread so here goes.
It damp proofs the foundation
So thats actually true. It does not water proof, just damp proofs
But why is damp proofing needed? We have no basements here. Everything is slab on ground or on piers with an open crawlspace.
For starters, look at the bottom edge of the siding. Those little brown dots are water marks from little drips that have dried leaving a residue. Nice green grass growing up against the concrete, and the (if you look closely) the OSB is swelling like MDF does when it gets wet. That OSB is in direct contact with the concrete also. Concrete that doesn’t have any damp proofing, water proofing, or sealed acts like a wick. Since the siding is clearly dripping directly next to the concrete , from sprinklers or rain, and grass is growing against the concrete, with what looks like not enough drainage, the concrete is acting like a sponge… It’s only a matter of time before rot sets in…
If damp proofing were applied to the concrete in this scenario, it would delay the inevitable for quite some time.
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Well done…Thanks for that insight! That really helps to understand things.
First off, let me congratulate you on your siding inspection process. By taking the steps to take images from under the siding starter course you reveal any installation and material defects and deficiencies you may otherwise overlook by just inspecting the facing of the siding.
Bravo Jesse!!!
Yes. “Flashing and WRB” are required.
I can see several installation defects. List what you can see. Take your time. I will add mine later.
From the Vinyl Siding Institute: [Vinyl Siding Installation] In-bold is mine.(How to Install Vinyl Siding - Vinyl Siding Institute - VSI).
Vinyl siding should be installed over a continuous water-resistive barrier to stop the intrusion of incidental water. Refer to Important Notes for more information on water-resistive barriers. Check your local building code for requirements in your geographic area.
Flashing
Code-compliant flashing should be integrated with the water-resistive barrier, (WRB) and applied around windows, doors, and other openings. Flashing should also be applied to inside and outside corners, and the intersection of walls and roofing to prevent water infiltration.
Hi Jesse, first new builds are the worst due to the unskilled labor of today work force. The installation you saw is common and doesn’t violate any building code but that doesn’t mean it’s correct. I would call it out to protect yourself and you client. Will the builder have an issue with your findings yep.