Permit issues are becoming more and more common in a residential real estate transaction. As more town building departments go online with their records every year, the more common checking for permits will become. As the local, Greater Hartford Association of Realtors (GHAR) purchase contract reads, there is no boiler plate language which requires a seller to attend to non-permitted repairs & improvements nor attend to open permits. However, in paragraph 9 “other conditions” you may see something to the tune of “all applicable permits to be pulled and closed with all fees paid prior to closing.” It is very possible that we will soon see this sort of language either end up as boiler plate language in the purchase contract or at least appear as an optional rider to a contract.
It is very common to find work that has been done without a permit. From furnaces and hot water heaters to finished basements and additional baths. From roofs and windows to decks and sheds. The list goes on. Not only are the permitting fees doubled for after-the-fact, existing work, permit issues can put the brakes on an otherwise smooth transaction. If you are selling and signing a contract with permit language in it, be sure that you are fully aware of what amount of time, effort, and money it may take to fulfill that obligation. If unpermitted work is not to code, there will likely be an additional expense and time needed to correct the issue and have it deemed compliant.
If you are buying, consider having this language in your offer and discuss with your realtor how this may affect the strength of the offer. It seems often that sellers do not flinch at this language, however feel as though they are being ask of something additional when it comes time to be taken care of.
For buyers, sellers, and homeowners in general, beyond obvious safety concerns there are issues with unpermitted work. With an insurance claim, if the cause of damage is an item that was not to code, you may have issues. If your wood stove is not to code and it causes a fire, your insurance may not cover the damage.
So, what should you do? If you are having work done at your home, be sure you are aware if it needs to be permitted or not. Do not rely on your contractor to bring this up and be proactive. Ask your contractor. This is a simple call to the building department if you are uncertain. If a permit is required, be sure to have the contractor pull one or pull one yourself (the process for application will be covered in next month’s issue). Be sure to be clear of the point at which during the process an inspection will be required. If work is being done that will be hidden by finishing work, as is often the case with electrical that will be ultimately covered by sheet rock, the building inspector will need to be out before the work is fully completed. Be sure to call the building department and arrange for inspections. This is the homeowner’s responsibility and typically is not done by the contractor. The contractor may need to be present or prepare the site for inspection. For example, with a new gas line for an added appliance, a pressure test may need to be active when the building inspector comes out.
Regarding permits that were once pulled, but remain open, House Bill No. 7046, Public Act No. 17-176, AN ACT CONCERNING
THE CLOSURE OF CERTAIN BUILDING PERMITS, was just recently signed into law this summer. In general, the law indicates that open permits will be automatically closed nine years after the date of issuance. This means if a permit was pulled for work on your home over nine years ago and is still open, it will be automatically closed in most cases. This does not, however, apply to work that was never permitted in the first place.