Building permits and unfinished rooms in potential house

Rehabbing & House Flipping
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Building permits and unfinished rooms in potential house

Anja Brey
Investor · San Francisco, CA · Member since 2014 · 78 posts · 10 votes

Hi all, 

We are looking into buying this very cool victorian house from 1894 in Contra Costa County in CA. The house is a bit funky and contains a full functional living unit on the second floor but the ground floor, (basement), which is on a slab, seems to have been remodeled at some point, but not at all finished. I called the County and there seem to be not permits for the unfinished large room, bathroom and laundry room on the ground level, but for a new slab and underground plumbing from 2005.

We are thinking of buying the house and creating a studio on the ground floor and renting it out to a tenant.

We have never dealt with permits, and we would probably hire a licensed contractor for the electricity, plumbing, heating, floors, walls and windows, but would do the rest ourselves. 

What are things we need to consider when buying this property? Would you ask the owner to pull the permits for what he did in the past as a condition of the sales contract? The county told me that once I buy the property, I am fully responsible for everything, which could include code enforcement fines. 

Thanks so much! 

Anja

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Valerie Hiscoe
Investor · Richmond, BC · Member since 2013 · 316 posts · 133 votes
10y

Just a small warning:

In some areas, as soon as you pull a permit, all systems in the whole house must then be brought to code.  Everything, everywhere.

Also, it's incredibly difficult for an inspector to approve work that he can't see - be prepared to tear down drywall to expose wiring (and is the insulation fire code approved?) and to break through the concrete to expose the plumbing 6ft down.

Be careful.

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  • Nicole Allen
    Specialist · Washington, DC · Member since 2014 · 16 posts · 3 votes
    10y

    Before buying I would definitely check out all the permits issued and inspections that would have occurred for the slab, electrical, plumbing and structural/foundation.  If they pulled the permits but didn't get it inspected (RED FLAG).  Definitely get the owner to get the permits if you can, otherwise contact the inspector and ask for an extension on the permit or a review of the last submittal.  Best of luck.  Also look for a permit expeditor in your area.  we have a wealth of knowledge :)

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  • Manolo D.
    Contractor · Los Angeles, CA · Member since 2015 · 4k+ posts · 1k+ votes
    10y
    Anja Wehrmann First will be ask them again on how much fines is there. I am not sure if that is accurate, it doesn't make sense, if you buy the house, and approach the city to pull the permit in good faith, then you shouldn't be fined. I am more inclined on you pulling that permit instead of the owner, often times the owner is not interested or lazy, so all that hard work will go to the drain. If you pull the permit, just deduct the permit fees and fines from your purchase price, consider that as part of your rehab costs. Maybe, just maybe, you don't have to pull permits if you are sourcing all those trades.
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  • Anja Brey
    OP
    Investor · San Francisco, CA · Member since 2014 · 78 posts · 10 votes
    10y

    Thank you @Manolo D. and @Nicole Allen. 

    Manolo, the fines would only be if the remodel he did is not up to code. 

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  • Manolo D.
    Contractor · Los Angeles, CA · Member since 2015 · 4k+ posts · 1k+ votes
    10y

    @Anja Brey Im still confused why they would fine you. But from my experience, I have had to clear a permit of an unpermitted garge room, it was cited by the city and is a code violation. The city did ask for me as a contractor (through the new owner) to pull a demo and building permit and make necessary corrections. The city did not fine the owner of the old violation, but they only asked to bring it to code (convert back to garage), or cancel the garage and pull new permits to make the room habitable and permitted. Other than the permits I pulled, there were no other payments made to the city. Just my $0.02.

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  • Valerie Hiscoe
    Investor · Richmond, BC · Member since 2013 · 316 posts · 133 votes
    10y

    Just a small warning:

    In some areas, as soon as you pull a permit, all systems in the whole house must then be brought to code.  Everything, everywhere.

    Also, it's incredibly difficult for an inspector to approve work that he can't see - be prepared to tear down drywall to expose wiring (and is the insulation fire code approved?) and to break through the concrete to expose the plumbing 6ft down.

    Be careful.

    1Reply
  • Nicole Allen
    Specialist · Washington, DC · Member since 2014 · 16 posts · 3 votes
    10y

    In most cases you may be able to show proof of purchase and they would waive the fees. Also Valarie Hiscoe is correct,  you may have to open up the wall to clear the old permit. 

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  • Manolo D.
    Contractor · Los Angeles, CA · Member since 2015 · 4k+ posts · 1k+ votes
    10y
    It's just another part of the scope. This is where a good contract will come in, and experienced contractor could foresee most of it.
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  • Kevin Loh
    Engineer · Forest Hills, NY · Member since 2016 · 14 posts · 7 votes
    10y

    @Anja BreyNot sure how it is in Contra Costa County, but in NYC anytype of unpermitted work done on premises is considered illegal. You'd have to file a job application for the scope of work, pull a permit, get it inspected by the Authority Having Jurisdiction (AHJ) and signed off. In my area the AHJ is the Department of Buildings. 

    I suggest checking the building history to see if there are any existing violations that you'd have to clear up and if there's any civil penalties involved. (Some fees can go upwards of $5000) 

    I've come across several owners who get saddled with all these costs because they didn't do their due diligence prior to purchasing the property. Which doesn't really make sense to me since all NYC properties are +500k .. you'd think someone spending that much would do their homework before hand. But then again without these people I'd be out of business.

    Sorry for the wall of text, just had to get my rant of the day out there.

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  • Justin R.
    Developer · San Diego, CA · Member since 2015 · 1k+ posts · 1k+ votes
    10y
    Anja Wehrmann Tread VERY carefully. Most of the projects we do involve adding square footage, additional units, and zoning issues in pre-1940's houses in So Cal. I know more about the Ca Building Code and my local zoning ordinances than I ever cared to learn. The unpermitted work isn't likely that big of a deal compared to legally splitting the units. If there's just two units on the property, it'll be FAR simpler than adding a third. Still, though, there are lots of gotchas, even if your zoning will currently allow the second unit, including: - Utility submeter requirements. - Water and sewer capacity fees (locally ~$10k just for approval per new dwelling unit). - Sewer sizing. You don't want to find out you've got a 3" and need a 4" main. - Parking requirements - Fire separation. You'll be tearing down all drywall on walls and ceilings shared by the units. On top of these known things, there's all the things you'll uncover on an old house when you open it up. Your contingency should be measured in $10's of thousands. Good luck!
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