Question:
When a house has an unpermitted room or addition, does one still purchase it and how does one handle this situation?
Answer:
This is a complicated issue. Typically, you’d want all the square footage in the home to be permitted. However, it has to do with the quality of construction, compliance with building codes, if it’s structurally sound and safe, how it will affect your financing such as, whether your intention is to keep it and rent it and refinance it in the near future or whether your exit strategy is to flip it immediately and expect the buyer to get new financing, and whether the code enforcement office has already red tagged your house and wants you to tear down the illegal addition or if illegal additions are typical for your market.