Kitchen in the basement. Should I worry?

Question

I'm bidding on a house that is a 2-family that has a 2 bedroom on the second floor, and a huge one bedroom on the first floor. The basement is part of a mother/daughter setup with a full bathroom and kitchenette. There is a 'bedroom' there too. (Quotes because it doesn't qualify due to lack of egress window)

I'm 99% sure the basement was finished without permits. I could possibly change the 'bedroom' into a bedroom. However I don't know if I the kitchen and/or bathroom is something that could bite me in the behind down the road.

What does BP think? Have you encountered something similar before?

Thanks!

John DeVito · Answer

Check the zoning for your county. Mother daughter status usually expires when the title is transferred. Also, if you can figure out the egress for c/o check to see if you can have a kitchenette as opposed to a kitchen. In other words, kitchen with micro and frig. Just no stove or dish washer.

On the other note, run your municipals. Most of the time if nothing shows up, it's because they didn't file. A lot of people get that backwards. If they files, it'll be there. If it's not, chances are it's not supposed to be.

Chris Mason · Answer

There is a strong possibility of appraisal issues on this one.

In general they can give value to below grade living area if and only if there is market data supporting it, and cannot count below grade space in GLA.

There's also a strategic decision to make about if you want to stage the thing to be appraised as a duplex or SFR, but that component you can worry about once you actually have it tied up in contract. Nothing really matters until you have it under contract.