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Do Flippers Remodel Without Permits?

Bay Area building officials are claiming that some flippers have started cutting corners and not getting permits or city inspections when they handle remodels. The large surge in poor quality foreclosures occurring has meant that there has been a lot of remodeling being done, providing more opportunities for flippers to skip many of the required steps. Of course, it’s not only the flippers who are remodeling without the permit of the city -- it has happened in many other related professional circles of the industry as well.

Often times, people opt for having remodeling work done without permits because they believe it saves them money. If they’re in a situation where additional people are joining their family and they need to make more room for these individuals, then they’re likely to go along with a basement remodel without permits because it’s quicker and cheaper. It’s not the best result possible, but it allows for them to get the job taken care of when they need it the most. Other times, they may do some research online and try to handle the project on their own.

Although this might sound reasonable at the time, by the time it has come for the property to be sold again in the future, that type of work without a permit is not acceptable. Appraisers cannot count it as part of the square footage of the home because it doesn’t meet the city codes and other requirements. They will take it into account and factor it into the value, but they’ll only give it a lower weight percentage in comparison to 100 percent if the work had of been completed with permits and city approval. Buying a house with work that has been completed without a permit can also be problematic for the new owner.

The issue often times is that most homeowners aren’t even aware that there are issues with the property. The property may have been sold four times in the past twenty years and they’re not aware of if the work was done with a permit or not. It turns into a buyer-beware situation. However, it’s a very serious issue. If someone was going to get access to permits to do an expansion of their kitchen or another area in their household and then the city came out to inspect and inquired as to whether previous work was permitted, they could possibly put an abatement on the property and require that everything is redone correctly or even have everything removed to returned to its previous state based on the lack of permits on previous work. As a result, homeowners are warned to be very careful when they are considering investing into purchasing a new home because unless they have actual proof that previous work has been done with permits, it can cause them a lot of trouble in the long run.

Amy Wright
Christina
Amy Wright is the Lead Editor of Remodeling Central. When she isn't playing with her dogs she is trying to remodel a classic Chicago style brownstone with her husband.