My First Rehab Project, Do I need Permits?

Question

Hello all...

I am working on my first rehab project and have a few questions I hope you seasoned investors will answer. The project is for a duplex built in 1920; both units have 2 bedrooms, 1 bathroom, and of course a living room and kitchen. It is in a low-income area, and was vandalized.

Both units need rewiring, and plumbing. Both bathrooms need to be gutted down to the studs, and the kitchen in the first unit needs to be gutted down to the studs. Furthermore, the ceiling above the atticin one of the bedrooms in the first unit was cut out, and the HVAC was removed from the vandalism.

The hardwood in both units look good enough just to refinish them. We also need to paint the interior and exterior of the duplex. The major lawn work is to trim the branches off of a tree in the back yard that is hanging over the duplex. Oh, and the first unit has a small deck off the kitchen that looks like rotten wood.

My question is: should I look into getting permits? If so,what kind of permits do you think I will need, and how do I go about getting them?

Thanks!

Monty Alston · Answer

@Teresa Keith as of yesterday I am a new plus member at BP, but not new to construction. It sounds like you have already gotten most your questions answered. I am on ther other side of Atlanta in the West Georgia area, I hope to connect with as many fellow Georgians as possible, If you have any other construction related questions just let me know I will do my best to help. I admire your courage! Good Luck!

Teresa Keith · Answer

@ Wayne Brooks: Thank your help, I will definately look into the electrical, plumbing & HVAC permits, and will check to see if I need the for the bathrooms and kitchens. @Mark Fischer, you asked: 1. Have you already purchased this property: Yes, the property has been purchased by a foreign investor who we are doing the work for. 2. What is your total estimated cost of rehabbing?: After, coming up with my project plan, the estimate budget for the rehab is approx. 32k. 3. What kind of rent do you expect from the house? I need to find out from the investor about this one...thanks for asking. 4. Was the purchasing price low enough to make up for what sounds like pretty extensive (and usually expensive) renovations? Yes, the purchase price was 10k. My plan calls for inexpensive, but durable materials like linoleum flooring the bathrooms and kitchen. 5. Are you holding this property or planning to sell it off after the rehab is finished? The investor plans to rent it out, but we are going to propose to sell it. 6. You mentioned that the property is located in a lower income neighborhood and has been vandalized before. Are you taking any precautions to secure your investment while your rehabbing takes place? I would hate to see you put in brand new copper piping and have it all stolen overnight. One of our major milestones is to secure the premise. This will include boarding up the windows,and getting deadbolt locks for the front and back doors. Thanks all, for your questions and answers. Keep them coming.

Wayne Brooks · Answer

Yes, you'll certainly need electrical, plumbing and HVAC permits, which generally have to be pulled by those individual trades, licensed for that trade. Local reg.s will dictate if you can act as the "GC". Don't know if you'll need a general permit for the bath/kitchen, but I would guess so. Your local building dept can tell you what you need, likely including plans for most of the work signed off by an engineer or architect. Your contractors should be able to give you a few names. These will be necessary so the building dept. can determine if your planned work meets code or not.

Monty Alston · Answer

@Teresa Keith you are right! There are some rough places around Metro Atlanta. I think it's pretty much the same in every big city, so the main thing is to be safe! I am primarily a contractor building my portfolio,knowledge and hands on experience to become a RE investor. BTW I have excepted your request as a colleague. Look forward to hearing from you.

Teresa Keith · Answer

@Monty A.: Thank you, that encourages me (gives me an extra boost). I tell ya though, when my mentor told me the location of the property I was a tiny bit reluctant, but my excitement to PM my first rehab without putting one dime in it made me get over it quickly - like in 2 seconds (lol). When we did the walk-through so that I can gather information to put into a project plan, it was not too bad (the neighborhood that is). But, I guess because it was day-time. I will definately look you up on BP in the future (probably soon too). By the way, are you an RE Investor or a General Contractor?

Teresa Keith · Answer

@Mark Fischer: Thank you, Mark. I trying to keep you investors on your toes....lol - kidding.

Mark Fischer · Answer

Teresa Keith I'm glad you cleared that up! Your original post made it sound like you were going at this alone and had just purchased a really rundown property that needed a lot of work. I have to admit I had some alarm bells ringing as I read. Very different scenario now. Enjoy your learning experience!

Teresa Keith · Answer

@J. Scott: I know what you mean; I should have mentioned that my mentor who is a seasoned investor got this request from a foreign investor who lives in Hong Kong. She asked him to project manage (PM) the rehab. Thus, my mentor saw this as an opportunity for me to learn how to project manage rehabs to gain knowledge, so he gave it to me to handle. He did make the Hong Kong investor who owns the property that I will be the PM. Of course, he has the contractors to get the work done. So, this is a learning process for me (by the way, I was hired to do this, so there will be compesation...lol) Thanks for pointing this out, it will clear up any other confusion. I am sure others probably were thinking the samething....lol.

J Scott · Answer

If it's Fulton or City of Atlanta, that's probably even worse... Don't take this the wrong way, but why did you agree to do a rehab for an investor if you didn't have this basic information about what would be required in terms of licensing and permits? It doesn't sound like you have much contracting or rehabbing background...and that's what it sounds like you agreed to do...

Teresa Keith · Answer

@J. Scott: Thank you so much for this information, I did not know the plumber and HVAC company has to pull work permits. But, the rehab. is not in Gwinnett county, its in SW Atlanta - West End area (I think this area falls under Fulton). Have you rehabbed here in the Atlanta area before? @Bryan L.: Thank you for sharing your information, I'm glad you mentioned about the HVAC guy probably does not pull permits; gives me something additional to go by and to research for my area. Thanks again, all :-)