Properties with illegal additions

[Nat C.]

In the past week I've looked at 10 MLS properties. 5 of those had illegal additions. I'm not talking about an extra little balcony either. What was originally a single family house has had double the square footage added on and turned into a multi-family property. Some present as amazing deals....however I am unsure of the consequences. Some of the listings state the city requires a certificate of re-occupancy. This is fairly standard procedure when an REO is sold. So the city does an inspection to make sure there are no violations and everything is up to code. Now what's going to happen when they see a whole other house built there? Not to mention the illegal additions all look like they were built by someone who didn't know what they were doing. In today's inspection, my head touched the doorway to a bedroom and I'm only 5'11". Is the city going to make you demolish the whole thing or will they let you just correct anything which violates codes? So if the doorway height is too low, could it just be raised?

[Jacques Wurms]

If you buy a house with illegal additions at least pay the price based on the legal size and rooms. In other words if it is a legal 2/2 that is how you should price it. I would not pay for an additional 3th illegal room. The problems appears when you try to put a new mortgage on the house or want to sell it again. The bank and or realtor  will see in the tax record what the legal size is of the house.