Garage Conversion w/o Permits

5 Replies

Can anyone tell me how big of a deal it is to have work done without permits? The work being the addition of a second bathroom to a 3/1 in San Leandro, CA and the conversion of the remaining garage space into a studio apartment with separate entrance. 

My long term objective for the property (currently my primary residence) is to live in it for another 12-18 months, then rent it out for 2.5 years (hopefully both sides separately) and then sell it. As an agent, I've seen plenty of houses listed that had work without permits done, so I don't know how big of a thing it is. Also, how much more difficult/expensive is it to get permits? 

The worst case is the city finds out and makes you undo the work.

When you go to sell, you may have problems selling with unpermitted work.

Hi @Rob B. . Additions without permits are a huge deal. Over by me the town would catch you doing it even if you didn't want to pull a permit. You also want to make a new apartment out of a garage. Will that pass CCO when renting to a new tenant? That doesn't seem like it would be a legal apartment since the city has no knowledge of it. If this property were to catch fire I'm pretty sure your insurance would not cover you. Very risky in my opinion. 

did you ever add the income sweet to your garage? I would like to do this in my garage. 

Originally posted by @William Decker :

did you ever add the income sweet to your garage? I would like to do this in my garage. 

 I haven't done it yet. I spoke to the city of SL and they said that it was not allowed unless I wanted to build another garage so that the property had the right amount of garage space. I haven't ruled it out completely, but we're currently looking at purchasing another property and potentially moving in, we haven't made a decision on what to do with the garage. On the one hand, we could rent it out as two separate units, on the other, it would make it riskier to sell. 

This is something that I work with on a daily basis.  

Positives:

  • Extra income.
  • Today FNMA doesn't really care about non-conforming areas as long as LIKE properties transact in your market.
  • Added income for a potential buyer.

Negatives:

  • Insurance - If destroyed you couldn't get it re-built.
  • Possible fines or you could be asked to re-convert the home back to its permitted use.
  • What happens if a tenant gets injured by living in a non-permitted area?  Un-permitted areas are usually constructed without county approvals and inspections; therefore, I could see where you wouldn't be covered by insurance.   

There are more issues but these are the main ones to me.