Under Contract, Can I Back Out Because of Bathroom Removal?

[Akram Ramdan]

Hi all,

I am a first time investor currently purchasing a two-family home in Clifton, NJ. I am currently under contract with the last step being to obtain a Certificate of Occupancy from the town. The current Clifton, NJ zoning laws do not allow any (partial or full) bathrooms in the attic and only allow partial bathrooms in the basement. The home that I am purchasing has four bedrooms and four full bathrooms (one full bathroom in both the attic and the basement). This is how the home was listed and this is how the home is currently being tax assessed. I spoke with the Tax assessors and the building department who informed me that back in 1995, the township requested to remove the bathroom and the kitchen from the attic. When I did my walk through, I did not see a kitchen in the attic, but I still see a full bathroom. My question is, if the city refuses to issue a certificate of occupancy unless the seller removes the full bathroom in the attic and the shower in the basement bathroom, can I back out of the deal? I spoke to my attorney and he said the contract does not explicitly state how many bathrooms/bedrooms the house has, but it is only stated in the listing sheet. He said if I do back out, I can risk getting sued and it would be up to the judge to decide. I am concerned as a quick google search showed me that a bathroom adds on average, $28,000 of value to a home. This removal would significantly devalue the home and I would also be receiving less rent if I rent the attic and top unit together with only one bathroom as opposed to two bathrooms. 

Please advise,

Thank you