Questions:
Is this venting of a powder room directly into the soffit a problem or
a regular practice? Since there's no shower or bathtub to produce
excess moisture, maybe it's not a problem.

Why did the builder put a flappy vent right above the fan and never
use it? My assumption was that they meant to connect the fan to the
vent and forgot, but my builder is respectable and so seemed the
repair guy. I don't automatically assume he's giving me a line to
avoid doing work.

The only other thing it could be is just a way for that small roof
area to breathe to the outside air. But if that was the case i would
have expected just a roof air vent like the ones that are up on the
attic roof (not in my picture).

Kevin

Kevin,

The "flappy" vent is correctly termed a barometric vent. When the pressure
inside the soffit space reaches a certain pressure, the vent will open and
releive the pressure. What may be happening is the envelope surrounding the
soffit space is not sealed properly, thus infiltrating or exfiltating the
air. If the air is exfiltrating, it is a good thing because the exhaust air
which is heated in the winter and cooled in the summer is helping to provide
a makeshift air barrier in the soffit space, and as stated earlier, there
shouldn't be any added moisture to the space. If however, the soffit space
is infiltating air, you may eventually have a mold problem from moisture
entering the space. Either way, the exhaust fan is only helping the
situation by pressurizing the soffit space somewhat.