Rehab w/o permits from previous owner. Is this a concern?

Question

My wife and I are looking to buy our first rental property.  We found a property we like in a great location and it has been mostly renovated already. It will still need some work but we have a trusted contractor. I went to town hall to pull the files and found out the previous owner didn't obtain any building permits.  After walking through the property with a contractor the work appears to be done correctly. Is this a big concern or are we just nervous newbies?

James Barnhart · Answer

@Rob Hallowell

Yes, it is a concern.  Do you know the quality of the construction work?  Or was it just done on the cheap to impress a buyer like yourself.

In some jurisdictions, the city or county will want you to get an engineer's affidavit letter for work done without a permit and inspections.   The engineer will have to say that he inspected it, and it is at least as strong as the building code.

Or else, apply for a demolition permit and tear it down.

Your insurance company may want you to show them your permit and inspection record before they will insure it.  They are getting very picky in our area.

Tyler Hampton · Answer

@Rob Hallowell

I’m just finding out this is a thing. I’ve lived in my personal house for almost 7 years and I’ve redone tons of stuff (finished basement, remodeled kitchen) and never got a permit except for doing all new HVAC. I hope it doesn’t cause issues when I try to sell it. Although I don’t plan on selling it for a long time. So I guess my point is, I’ve had a lot remodeled with quality contractors that never got permits pulled. So as long as your trusted contractor says the work is legit, I think that is normal.

Russell Brazil · Answer

If this was done by the homeowner, that is very typical. Very few people pull permits when they are doing work on their own homes.

Rob Hallowell · Answer

Thanks @Aaron Gilbert

Aaron Gilbert · Answer

If your trusted contractor walked the property and gave it a go, then I wouldn't hesitate to proceed. The permit pulling process is just a way for the city to justify their existence and collect more revenue. If you don't have experience in the construction field then I would recommend always having your contractor walk the property before signing on the dotted line, even if permits were pulled.