I understand they are due when the building permits are pulled. 

Mike, My recommendation would be during due diligence for a potential purchase, ask for past 12 months of all utility bills, property taxes, and any other municipal requirements like rental permits, occupancy inspections etc. 

This is just markets behaving normally, Austin was my first target two years ago once I got wind of the permitting and homebuilding we saw the long coming in and whether it was 2,3 or 4 years the entry point was way in front of us.I don't know if anyone gets "use to" 7% rates without home prices behaving and/or wages responding appropriately.

Meanwhile during the eviction period, we finalized our architectural plans and started the permitting process in the county so we didn't lose much time.

If you are doing renovations that are more than cosmetic, you should be pulling permits and those generally require contracts because permit pricing is often based on contract value.

Permitting for additional bedrooms and garage conversions requires compliance with zoning and building codes.

The snippet you provided is a bit ambiguous which may itself make it unenforceable.I think your goal should be to get a signed doc from the parties to the agreement saying an STR is permitted under the agreement.

Because thats about how long it teams to get stuff permitted and built out there. 

Beyond that, terminate the tenancy based on your lease (you should have a clause in there that permits eviction for this kind of behavior).

I have a deal that was presented to me that currently has some mobile homes with permits to expand.