Since rain dampens the exterior walls of the house, so it is better not to consider painting outer walls in the rainy season because putty is just a base coat for paint, and it is not breathable, i.e., there is no room for trapped moisture to come out and that is the reason why you see putty flakes. On the other hand, you can apply interior wall putty on your house's inside walls as the putty wall will help give a smooth finish to the interior walls.