Real Estate Investor · Marrero, LA · Member since 2011 · 43 posts · 6 votes
Closing on a REO on Tuesday. It is or was listed as a two bedroom/one bath for 56k, which is a good deal for the area it is in. Went look at the property and discoved it was a three bed one bath. That makes this a really good deal. They accepted 50k that made this and even better deal. All the Bedrooms have closets and windows. Wondering if anyone ever seen the bank and the listing agent make a mistake like this or maybe there is a reason it was not considered a three bedroom?
Happens all of the time. More bedrooms, less bedrooms, wrong county records, illegal property changes, you name it.
Be careful how you approach the city, sometimes you are opening a can of worms that cannot be shut.
1. City informs code enforcement, you find out you have an illegal addition, costs thousands to fix.
2. City informs public works you have an extra bedroom, they assess your home a public works user fee based on likely increased occupancy given the extra bedroom - that's a couple thousand in cities like Santa Ana, CA.
3. Extra bedroom changes plumbing rules, if home is on septic and they are not using strict fixture counts for sizing - new/expanded septic.
4. Extra bedroom is not permitted and yet is tied into existing structure - to permit costs thousands, to tear down costs thousands... fun stuff.
What does county records say? Does it look like a garage or porch was converted into a bedroom? Many times this reflects an unpermitted conversion that's still listed as two beds in county records.
Happens all of the time. More bedrooms, less bedrooms, wrong county records, illegal property changes, you name it.
Be careful how you approach the city, sometimes you are opening a can of worms that cannot be shut.
1. City informs code enforcement, you find out you have an illegal addition, costs thousands to fix.
2. City informs public works you have an extra bedroom, they assess your home a public works user fee based on likely increased occupancy given the extra bedroom - that's a couple thousand in cities like Santa Ana, CA.
3. Extra bedroom changes plumbing rules, if home is on septic and they are not using strict fixture counts for sizing - new/expanded septic.
4. Extra bedroom is not permitted and yet is tied into existing structure - to permit costs thousands, to tear down costs thousands... fun stuff.
Depends what you are planning to do with the property. In our area it seems to me that there is a stricter definition of a bedroom for selling vs. renting. If you're going to rent it, list it as a 3rd bedroom.
I'm actually closing on a house soon that is similar to this, the 3rd room fits the bedroom description but would, in my opinion, actually make a better office. So I'm going to advertise it as both a 2 bed + office and 3 bed on craiglist and see who rents it and what they were looking for.
All that I was able to find were the permit back to 77'. Went to mortgage and conveyance office and pulled records. It sold in 1980 as a three bedroom. all the bedrooms have closets and and windows.
When a bank lists a REO they mainly rely on what the records show on the tax roll. Many times the tax rolls have not been updated correctly with new additions so the square footage amount is wrong. Jason is right, check what the original permit was for the house when it was built if there are no other permits on file. If your home is not permitted as a 3 bedroom you now have a 2 bedroom which is an inferior product and a lower value than a 3 bedroom. Even though you have a bedroom there most appraisers won't give you much value. Many people get burned on this in our area where we buy. Be careful!
Could it be that one of the bedrooms is used as a pass-through to get into another bedroom or any other room? If so, then that pass through "bedroom" is actually a "hallway" ...
What are the realistic ramifications of buying a house that has an illegal extra bedroom that the previous owners build (converted part of the garage)? We are looking at one and it's been well done but from what info I can find there was never a permit for adding the extra bedroom. Could we get into a lot of trouble with this even as a rental?
What are the realistic ramifications of buying a house that has an illegal extra bedroom that the previous owners build (converted part of the garage)? We are looking at one and it's been well done but from what info I can find there was never a permit for adding the extra bedroom. Could we get into a lot of trouble with this even as a rental?
When these threads occur on BP, I often wonder the same thing. I suppose the worst case scenario is that something goes wrong, like a fire from improper electrical work, and a tenant gets hurt/dies and sues.
But even in that case, say the addition is 15 years old, and you really couldn't tell by cursory inspection with a trained eye that it was an addition? Aside from the liablility already assumed just by owning a rental without additions, how culpable are you you in this instance?
I recently bouught a house that is more than 50 years old. I have discovered that 4 ft were added on to the original structure to extend the kitchen in order to make room for a washer and dryer (washer and dryers inside the kitchen were all the rave at one point in time...). Later, I discovered the kitchen had been remodeled and replumbed. But the remodel was so old, all the piping was still galvanized and cast iron. There was really no way of knowing there was an addition and remodel to the kitchen except for extensive rehab uncovering the mystery. I have no idea if this work was permitted and have no plans to investigate. Personally, I'm not even worried about it. But based on many comments in these types of threads, I could worry myself to the point of no sleep.
Also, OP stated all the bedrooms had closets and windows. I would chalk it up to a typo or mistake in paper work, move on and be happy about it as it may have turned off several investors who wouldnt't consider a two bedroom as a matter of policy.
I called the building permit folks today to ask about this. They said it depends on what the records show. Of course I did NOT give them the address as I don't want to open a can of worms. But they did say that it depends on how long ago it was added, if there was a stop work order issued, etc., I asked if it's unknown how long ago it was added and no stop work issue ordered and no record of a permit, then what?? They said they would probably have one of their inspectors come out and take a look (Yikes) and said sometimes they just ignore it and nothing is done.
So I'm still on the fence with this in not knowing if we should take our chances and put in an offer on this house or not. It has a roof issue that needs repairs, but I'm actually more concerned about the illegal 4th bedroom issue as I know the roof can be fixed. But the room would be a nightmare if we were ever ordered to tear it out, etc.,
I called the building permit folks today to ask about this. They said it depends on what the records show. Of course I did NOT give them the address as I don't want to open a can of worms. But they did say that it depends on how long ago it was added, if there was a stop work order issued, etc., I asked if it's unknown how long ago it was added and no stop work issue ordered and no record of a permit, then what?? They said they would probably have one of their inspectors come out and take a look (Yikes) and said sometimes they just ignore it and nothing is done.
So I'm still on the fence with this in not knowing if we should take our chances and put in an offer on this house or not. It has a roof issue that needs repairs, but I'm actually more concerned about the illegal 4th bedroom issue as I know the roof can be fixed. But the room would be a nightmare if we were ever ordered to tear it out, etc.,
Kel,
If the workmanship is good I wouldn't worry about it. I feel comfortable evaluating the quality of framing, plumbing and wiring. Anybody can tell if finshes look good. So, if it passes my scrutiny, I wouldn't worry about it. If I did not have the knoweledge of all or some of these items, I would ask a trusted friend/contractor who does and get them to help evaluate and look for potential issues.
I personally don't like garage additions as they are rarely well done enough to satisfy me. I don't like how the floor is lower than the rest of the house (usually),and if an HVAC system isn't properly retrofitted for the new volume of space , there is a need for a window unit, which I also don't like.