Permitting... Yes? Or no?

[Art Albegov]

Hello awesome BiggerPocketers,

I'm pretty new to real estate, and I just purchased my first property in the San Bernardino, CA area. I might've bitten off more than I can chew, and wanted to see what you guys think about my situation.

My buddy is a remodeler and has been kind enough to help me through all the repairs/upgrades on the property. We've being doing everything ourselves to keep cost at minimum.

Few things to know about the house:

* It's 106 years old.

* Has an 8' x 4' only communal bathroom (probably unpermitted) in the kitchen. This bathroom is very poorly made and the house seems to be sinking a bit from that side. That's probably because of the added bathroom. My buddy said that the foundation definitely needs to be reinforced. We possibly need to use some car jacks to lift up the sinking side of the house.

* Has a 300 SQFT ADU (most likely unpermitted) attached to the garage with it's own bathroom and kitchenette.

* Has an ancient 100 AMP external electric panel and some nobbin tubes in the walls. Also, one internal panel for each doweling. My buddy suggested that we install new 200 AMP external panel, new internal panels, and rewire both dowelings.

* Exterior currently has old shingles. I'm thinking I might get it stuccoed or install new wood panels at some point.

Problem: The above descriptions is pretty loaded so feel free to share your share your thoughts, but my biggest fear/problem is permitting.

I'd love to do things the right way and get everything permitted. However, my fear is that if I bring a city inspector to the property, I might open a can of worms. I'm guessing no inspections have been done since the house has been built.

What are your thoughts on this?

After all the renovations, if I decide to keep it and rent it by the room, it'll probably still make about 30% ROI without factoring in the appreciating and loan paydown. If I decide to sell it, I might end up making $20K - $50K

I'm leaning towards keeping it, but open to suggestions.

Thank you so much for reading this far and helping out.