Pulling Permits after the fact

[Carl Dieckmann]

Hey guys, looking for whatever advice you can provide. I'm in Travis County, NW of Austin. I have a flip I'm about to close on with amazing views and good numbers once renovated. The house has an appraised sq footage of around 3000, but is only 1700 on the tax records. The old owner expanded without permits. I'm planning on pulling them - any advice on how to stay good with the county since it is kind of after-the-fact. Thanks!

[Alex G.]

That's not really an answer to your question. But why you'd want to pull permits, unless you absolutely have to? You can remodel without permits and disclose accordingly on the Seller Disclosure. I suggest over- disclosures in this case to avoid future liability. Since you're a licensee I'm sure you know what I mean.

It's a very personal decision for each investor, as well as for each project. I've gone from no permits on a $250K remodeling project to full permits on others, and back to no permits. If you do pull permits you're looking at substantial delays and hussles with plans reivew/approvals, inspections, significant city fees. 

Don't forget to figure in extra engineering, plubming and electrical cost increases as your plumber, electrician and contractors will pad their bills to cover the extra costs and time they'll have to expand on compliance. 

While pulling permits at least in theory increases the desirability of the property, current demand  for properties in good condition in a hot area is such that you likely won't see major difference in the resale price, as long as you do your remodeling job right.