Featuring America's Home Inspector: Nationally Syndicated Columnist, Barry Stone

“Non-Permitted” Home Improvements

The House Detective:  by Barry Stone, Certified Home Inspector

Dear Barry: Now that I’m selling my home, I’m concerned about improvements that were done without building permits. In some of your articles, you stressed the importance of disclosing non-permitted work to buyers. But will this disclosure really protect me from liability?  JoAnna

Dear JoAnna: We live in a sue-happy world, with no absolute protection from legal liability. Regardless of what we do, we can be sued for doing something wrong, and we can be sued for doing nothing wrong. Fortunately, we can take steps to reduce our levels of liability, but we can never eliminate that liability completely.

When selling a home, full disclosure of non-permitted work reduces your liability, but the way that you frame those disclosures can make a critical difference. A common mistake that many seller make is to state or imply that all work was done correctly or “according to code”, even though it was done without permits. Such statements can get sellers into deep trouble.

Unless sellers are professional building inspectors, they have no idea whether improvements were done according to code. Building codes are voluminous and exhaustively complicated, and only the most informed experts are totally familiar with their intricacies. When disclosing that work was done without permits, you should state that “no guaranty is made regarding compliance with building codes.” You should also recommend that buyers hire a qualified home inspector to evaluate the condition of the improvements, as well as the rest of the property. With that kind of disclosure, you should be reasonably safe from complaints after the close of escrow.

As-Built Permits for Sellers

The House Detective:  by Barry Stone, Certified Home Inspector

Dear Barry: In past articles you’ve mentioned “as-built permits” for additions and alterations that were done without building permits. I have a property that was totally renovated — new electrical, plumbing, heating, and roof — all done without permits. I’m going to list the property for sale and want to know if an as-built permit is a good idea before I sell. Could you explain how this works?  Lou

Dear Lou: When you sell a home with non-permitted alterations, you have two choices: You can sell it “as is”, but with full disclosure of non-permitted work, or you can get an as-built permit and, hopefully, make everything legal. But before you apply for an as-built permit, you should be aware of the pros and cons.

Most building departments offer as-built permits as a way to bring maverick additions and alterations into legal conformity. On its face, the concept is quite simple: You submit a set of plans to the building official with an application for a building permit. With a normal building permit, you obtain permission to perform work. With an as-built permit, you seek approval for work that was already completed, to be sure that it complies with the building code. If the proposed plans conform with municipal standards, they are accepted, and a building inspection is scheduled. If the scope of work is not acceptable, the permit is denied, and the building official may order restoration of the building to its original state.

Examples of unacceptable changes would be additions that are too close to property lines, a garage conversion where enclosed parking is required, or a second living unit where single-family occupancy is the limit.

If the plans are approved, the next hurtle is the building inspection. In the best of cases, the building inspector performs a visual, walk-through inspection of the project area. If no building violations are found, the work is officially approved, and the completed work is given the same status as construction that was permitted in advance. In most cases, some code violations are cited, and a correction notice is given to the property owner. When faulty conditions are corrected, the property is reinspected, and final approval is given. But “cakewalk” approval of this kind is not always the case.

If the building inspector finds significant defects that warrant further evaluation, or if the inspector is overly committed to hardcore scrutiny, or if the inspector just happens to be having a bad-hair-day, you could incur demands that would make your head and pocketbook spin. For example, the inspector might order partial or total removal of drywall and other finish materials so that wiring, plumbing, and framing components can be inspected. Excavation of foundations or of buried utility lines might be ordered so that code compliance can be verified. If concealed deficiencies are found, the inspector could demand numerous upgrades and improvements or demolition of all completed work.

To prepare for this process, you should hire a qualified home inspector to perform a preliminary inspection. This will alert you to defects likely to be cited by the municipal inspector. With that information, you can make an educated choice between an as-built permit or disclosure of defects and of non-permitted work.