Purchasing a rental with code compliance issues

[Ying Tang]

Hi BP folks,

I’m evaluating a rental property and would appreciate some insight from investors who’ve dealt with city code compliance issues.

Here’s the situation:

• The property was being operated as a 6-bedroom rental
• The owner converted the garage into a bedroom
• According to the seller’s agent, the property was cited by the city for code compliance, mainly related to parking requirements
• The city allegedly required either:
  
1. Adding additional parking (such as building a carport), or
2. Reducing occupancy / removing tenants

The seller chose not to add a carport, and instead removed 3 out of the 6 tenants.

The agent also mentioned that if a carport is added, the property could legally go back to renting to all 6 occupants.

What makes this more confusing is that:

• The property appears to have sufficient frontage and lot space to add a driveway and/or carport
• From a physical standpoint, adding parking does not seem difficult
• Yet the seller still chose not to cure the issue and is now selling

In addition:

• This seller has 5–6 properties that were all cited for code compliance, and they are now selling all of them below market

My questions for the group:

1. Has anyone dealt with garage-to-bedroom conversions tied to parking or occupancy violations?
2. Would you be comfortable relying on the statement that “adding a carport fixes everything” without written confirmation from the city?
3. Even if frontage and lot size look sufficient, what are common hidden reasons a carport might not be approved (setbacks, zoning, non-conforming use, triggering further inspections, etc.)?
4. Is it reasonable for a buyer to contact the city’s code compliance office directly to confirm the exact violation and permitted remedies?

I’m trying to understand whether this is a straightforward fix or a situation where the risk is being understated.

Any insight or real-world experience would be appreciated. Thanks!