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Answers (14)
- Jim Ventura, "rktekt99"
- Contributions:32
you'll learn... keep searching things out on the sellers side, and you'll learn. You'll miss something, and you'll learn. Done with this topic - anyone other than nealadler send private email for more info -
- nealadler
- Contributions:199
Disclose! Disclose! Disclose! You should disclose any unpermitted additions, renovations on the Transfer Dislcosure Statement (TDS), Seller Property Questionnaire (SPQ), and the Supplemental Statutory Disclosure (SSD) forms.
- Jim Ventura, "rktekt99"
- Contributions:32
oh! looks like I said most of this before - sorry, post was started a long time ago...
- Jim Ventura, "rktekt99"
- Contributions:32
In completing the disclosures, you are making "observations" which are typical of what a real estate agent should know - you are not an architect, home inspector, or anything else like that! You make "observations", not "inspections" - It makes sense to note areas that look odd, it makes sense to "disclaim" in the listing that buyer should research permits etc.
- Jim Ventura, "rktekt99"
- Contributions:32
OK, I've been avoiding boring you with this entire story, but it seems to need to be told.
As I said, anything you absolutely KNOW must be told. Agree with nealadler and others.
I once took a listing in Torrance. The property had been previously listed from when my seller bought it, years before, and that was still viewable on the MLS. It had been listed, and my seller bought it, as a 3 bedroom. Now, I am trained in architecture as well, with a degree and many many home remodels under my belt over the years, therefore, I know what a bedroom is. It has a certain average minimum ceiling height, a certain minimum square footage and dimensions, it has an escape window with a certain minimum size and sill height for it to be able to be considered an escape, it has 10% of the floor area of window / skylight - and half of that is openable for ventilation. There are other basic requirements. All three of the rooms in that house met all of the requirements to be a bedroom, period. With that fact, and the previous listing showing three bedrooms, I listed it as a 3 bedroom. I of course asked the seller if they knew anything about the house which was not obvious, and they answered no.
Now, once upon a time, when the contracts were different and "as-is" was not the absolute case, I would pull permits on all of my listings. It occurred to me that all I was doing was relying on a title company to pull all permits, and then basically, by providing them, taking responsibility for those "facts". I decided then to go and pull my own permits, to make sure that all was done correctly, and I quickly realized that now I was depending on the guy at the counter at the building department, or whoever last had that file in their hands. The fact is, it is IMPOSSIBLE to be certain that all permits are there in the file for most cities. I am very happy we have switched to an "as-is" format, whereby, seller must disclose, but buyer must discover... thereby leaving us as listing agents out of the loop.
It turned out that the buyer remodeled the house 1 year later and discovered THEN that the house never got a permit for the third bedroom, and sued everybody. When the letter came from the lawyer, I called my errors and ommissions insurance and instructed them NOT to pay any monies on my behalf, we did nothing wrong. I based my argument on the fact that buyer made no effort to discover at the time of purchase, and that the room, although not permitted, was "permittable" - that is until they had destroyed it in their own remodel. We lost nothing, and nothing was paid from e & O - it also turned out that the seller DID know about it, along with some electrical work that was not permitted, and he DID pay monies to the buyer, though we told them very clearly to disclose everything they knew...
Years ago - no fun, but we did our job.
Research the permits, and in my opinion, you are taking on liability that a seller's agent should not take on. Ask your broker!
As I said, anything you absolutely KNOW must be told. Agree with nealadler and others.
I once took a listing in Torrance. The property had been previously listed from when my seller bought it, years before, and that was still viewable on the MLS. It had been listed, and my seller bought it, as a 3 bedroom. Now, I am trained in architecture as well, with a degree and many many home remodels under my belt over the years, therefore, I know what a bedroom is. It has a certain average minimum ceiling height, a certain minimum square footage and dimensions, it has an escape window with a certain minimum size and sill height for it to be able to be considered an escape, it has 10% of the floor area of window / skylight - and half of that is openable for ventilation. There are other basic requirements. All three of the rooms in that house met all of the requirements to be a bedroom, period. With that fact, and the previous listing showing three bedrooms, I listed it as a 3 bedroom. I of course asked the seller if they knew anything about the house which was not obvious, and they answered no.
Now, once upon a time, when the contracts were different and "as-is" was not the absolute case, I would pull permits on all of my listings. It occurred to me that all I was doing was relying on a title company to pull all permits, and then basically, by providing them, taking responsibility for those "facts". I decided then to go and pull my own permits, to make sure that all was done correctly, and I quickly realized that now I was depending on the guy at the counter at the building department, or whoever last had that file in their hands. The fact is, it is IMPOSSIBLE to be certain that all permits are there in the file for most cities. I am very happy we have switched to an "as-is" format, whereby, seller must disclose, but buyer must discover... thereby leaving us as listing agents out of the loop.
It turned out that the buyer remodeled the house 1 year later and discovered THEN that the house never got a permit for the third bedroom, and sued everybody. When the letter came from the lawyer, I called my errors and ommissions insurance and instructed them NOT to pay any monies on my behalf, we did nothing wrong. I based my argument on the fact that buyer made no effort to discover at the time of purchase, and that the room, although not permitted, was "permittable" - that is until they had destroyed it in their own remodel. We lost nothing, and nothing was paid from e & O - it also turned out that the seller DID know about it, along with some electrical work that was not permitted, and he DID pay monies to the buyer, though we told them very clearly to disclose everything they knew...
Years ago - no fun, but we did our job.
Research the permits, and in my opinion, you are taking on liability that a seller's agent should not take on. Ask your broker!
- nealadler
- Contributions:199
When all else fails you should disclose any unpermitted improvements period. Otherwise, you may have the potential for a lawsuit. This should be disclosed on the Transfer Disclosure Statement (required by state law), the SPQ (Seller Property Questionaire) and the SSD (Supplemental Statutory Disclosures), and the AVID (Agent Visual Inspection Disclosure).
- Jim Ventura, "rktekt99"
- Contributions:32
Remember the "discovery" process is on the buyer... you start providing pictures and copies of permits, etc... make sure you don't miss anything or mislead anyone! Best to simply state what you know for an absolute fact, and let the buyer do their inspections.... the questionnaire helps the seller to focus on specifics, so that's a good idea, for certain.
- Cristina H Garcia, "Realtor Krista"
- Contributions:32
Realtors have a new form call Seller Questioner. Answer the questions and include a picture showing the un-pernitted area and have the buyer sign off that they have a copy of this form and picture. Now this is a good disclosure.
- Yanni Raz, "yanniraz1"
- Contributions:75
You can sell the house in the same way you would sell any other home, but you have to disclose everything to the new buyer.
Good Luck
[hotlink removed by Zillow moderator]
Good Luck
[hotlink removed by Zillow moderator]
- Jim Ventura, "rktekt99"
- Contributions:32
All of that said, my question to you is... is it "permittable"? If you can get it permitted, you gain square footage, your future buyer will have an easier time paying your price if they can get a proper appraisal... everything gets better. In some cases it may not cost you much - you'll need a professional - you don't want to run over there to the building department and start alerting them to issues until you get a professional eye on it. Call or write me for alot more info!
- Jim Ventura, "rktekt99"
- Contributions:32
Hiya... I am a broker and also trained in architecture - let me take a crack at this one. First, in California, you can legally sell a property that is not "legal", "non conforming", etc. as the others have accurately stated as long as you disclose what you know. Seller does not have to "discover", simply to disclose what you actually know. You should check with your broker, but our opinion has been that seller's agent should NOT get involved in pulling of the existing permits, etc... the buyer must do the discovery work. There was a time when there was some consideration that all properties should be inspected by a consultant of the seller to make sure all was disclosed... but the direction remained, seller to disclose, buyer to discover.... all typical contracts use "as-is" phrasing. That said - you ALWAYS want to disclose what you know. Other things will be evident upon a reasonable broker observation (note I didn't say broker "inspection" - only an observation) i.e., bedrooms need to be a certain size minimum, certain average ceiling heights, certain square footages of natural light, and certain percentages of ventilation, plus an escape route through proper sizing of windows, second exits, etc. - this stuff is fairly easy to understand. other matters are not so easy to understand. once we sold a house where it was evident to me that there were what appeared to be three bedrooms (all criteria being met) - it turned out that tax records were wrong and didn't agree with what was on file with the city. What had happened was a previous owner had added the room illegally, new buyer began additions and ripped alot of it down - then sued my seller for failure to disclose it was actually a two bedroom. Seller swore to me they didn't know... my argument was that whether it was permitted or not had no bearing in that it was clearly "permittable" - I of course had no fault, seller took a small hit to settle - but it was determined (I'm told, again, we were not a party) that buyer needed to do discovery, proving my point above. (more in next post)
- Jackie Doornik, "I Recycle Cal Homes"
- Contributions:55
disclose, disclose, disclose. The buyer will have the decision to purchase the property or not. Unpermitted additions have far less (if any) value unlike permitted additions. The listing will show assessors square footage which does not usually included unpermitted square footage. A note about square footage is helpful in the remakes section of the listing.
- Yanni Raz, "yanniraz1"
- Contributions:75
You can sell it the way you sell any other home, but you have to know that it will not pass inspection if the buyer is not inform of the situation.
Notify the buyers about the situation and if they're fine with it so youre good to go.
[content removed by moderator for being self promotional]
Notify the buyers about the situation and if they're fine with it so youre good to go.
[content removed by moderator for being self promotional]
- CulverCityRealtor
- Contributions:458
Be sure to disclose the fact that there are un-permitted structures on the property. Normally we do not include the un permitted areas in the estimates (sf), nor do we use them to add value to the property.
what is the best way to sell a home with un-permitted areas?
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