Obviously, the home could be sold as the old sq ft and the investor/buyer can just go and permit it for the increased sq ft,  but I would think that the county automatically will go and assess the home as soon as it changes hands since this the county has probably seen this before. 

@Abel CurielAt the moment the only thing i’m Doing is checking online sites and see what homes are being sold by owner.

So in my state you have an inspection period after which there are options: present a formal "inspection objection" whereby you either withdraw from the sale, or request certain items to be remediated, or you ask for a cash discount so that you can remediate those items yourself.

The place sold in a few days. 

I put an offer on a property, inspector found 10 red items, one being a slant in the kitchen floor and cracked tile.

If you read my post https://www.biggerpockets.com/forums/223/topics/539116-second-flip-sold-and-bought-3-houses-in-a-single-day this is one of the places that I bought at the auction.

The former landlords were a retired couple who didn't seem to do things by the books so the lease is quite confusing and I'm hoping for some help..The pertinent line item of the lease reads as follows: "Month-to-Month Tenancy: This agreement may be terminated by mutual consent of the parties or by either party giving written notice at least 60 days prior to the end of any monthly period.

@Hadar OrkibiThe property is being sold as is 40k which is the land value.

Perhaps you could have a real estate agent appraise it and give you an idea of what to expect if you sold it in its current condition and what you could get if you found a way to make the repairs.

Purchased ~15 years ago at $360k, own free and clear, C+/B building in B/B+ neighborhood, currently paying themselves from property about $1200 a month, some capX items updated, clean, good screening criteria, painting and touch ups after each turnover.