California Owner/Builder Fix/Flip

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California Owner/Builder Fix/Flip

David Jarvi
Investor · Morongo Valley, CA · Member since 2013 · 53 posts · 48 votes

I'm researching what it means to be an Owner/Builder in CALIFORNIA and came across this website:

http://www.cslb.ca.gov/Consumers/Building_Official...

  • 1) Owner/builders NEED a contractor license if they "Intend" to sell   (no time given) (4 property max yr)
  • 2) Owner/builders DON'T NEED a license IF they IMPROVE a property and then complete the work sometime after residing in it for 12 months. 
  • 3) Owner/builders DON'T NEED a license IF they build a NEW HOUSE and live in for 12 months after (2 per 3 yrs)

It seems like if a landlord wants to improve properties he/she owns, it is ILLEGAL unless

  • non-permitted work (like painting, flooring, fences no higher than 6 feet, etc.. I believe)
  • have lived in any of those houses for 1yr, or currently living in the property for 1 yr)

The real question I guess, is what is permitted v. non-permitted work RE: local city/county/state codes

Moral of the story for ME: finding a good contractor is as important as finding a good deal.

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Jo-Ann LapinPro Member
Loan Officer · Tustin, CA · Member since 2015 · 3k+ posts · 713 votes
8y

It is essential.

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  • Jo-Ann LapinPro Member
    Loan Officer · Tustin, CA · Member since 2015 · 3k+ posts · 713 votes
    8y

    It is essential.

    [email protected]
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  • Jared RineBusiness Member
    Lender · Sacramento, CA · Member since 2009 · 1k+ posts · 277 votes
    8y

    @David Jarvi...as Jo-Ann mentioned, it's pretty essential especially when it comes to financing, or if you're doing a flip.  There aren't even many private money lenders out there who like to lend to an owner/builder on these types of projects, unless the owner/builder is a licensed GC, even if they have experience in building, construction, etc.  

    Most of the reasoning is pretty common sense - if the owner/builder passes away (God forbid), and they have to finish the project, they need a licensed party to do so and to continue with the plans, improvements, etc.

    Just my $.02.

    Jared Rine United Lending Partners53 Reviews
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  • Paul Choi
    Rental Property Investor · San Ramon, CA · Member since 2017 · 350 posts · 611 votes
    8y

    Typically, finishes work does not require a permit - flooring, paint, replacing interior doors in the same location, etc.

    Almost everything else typically requires a permit.  Need to go to your county and city building dept to check.

    For flippers (who want to sell the property in less than a year) and investors with rental properties who are not licensed contractor themselves, need to hire a licensed Contractor to do the work.  I've heard of people who get around this in different ways to save costs but it's a risk they're running.  

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