Buying property mid ADU permit

[Vi Nguyen]

I’m looking into buying a property from flippers who bought a 3/2 on an acre of land for $400k. They built it into a 4/2 with a 1/1 and a studio. They say that the ADUs buildings are permitted, they just didn’t get the permit completed as ADUs. 

I like the investment as everything is new so it doesn't require much extra capital to make it move in ready. My only concern is that it's not actually in the final stage of ADU permit and I'd have to spend a lot of money to re-do the structure and/or permit.

Is there a way to request what step they are on the the permit process, the permit manager contact with the city... etc to ensure it’s not going to be a money pit? 

Any advice would be greatly appreciated! 🙏🏼 happy holidays! 

[Matthew Forrest]

@Vi Nguyen Is the 1/1 the ADU or the studio? It would be helpful to know where you are located, but I would recommend that if your intention is that you want to rent out livable space in the 4/2, 1/1 and the studio then you want all of the structures to be permitted as dwelling units. If two of the three are already permitted as dwelling units and the third is in progress, that's fine as long as you can understand that is possible to complete the ADU permit and what the costs and time are associated with finishing. I would contact the city about where the permit is in the process and try to get information from the seller in writing (if its not in writing it's worthless). I like Wayne's idea about the permit status contingency.

If you choose to buy the property knowing that its not permitted to rent, but end up doing that under the radar, the city can come make your life difficult. Good luck and let us know what you end up doing!