This comes by way of email. (Of course, with permission from the author of said email.) So you can be guaranteed this is from one pro to another.
Hello Everyone,
First off, have any of you had any experiences or stories you can share that are on par with this one I am about to lay on you?
I closed on a property two weeks ago [removed] where I represented a buyer. They haven’t even moved in and were having some general work done, like paint, the floors, and some electrical work. The Seller stated in the supplement to the TDS that all work on the property had the necessary permits through the course of [their] 40+ years of ownership. The 3R [Report of Residential Building Record] indicated the kitchen was remodeled in 1980 and issued a ‘C’ completed.
Prior to moving in, my client was getting all the electrical outlets grounded and some lights added in the closets, and outlets added in the garage. Per my suggestion, they were doing all the work with permits. The city inspector came into the property and signed off on all the new work but also red-tagged everything not done with permits. This included 15-20 year old recessed lights wired to nob and tube, and the electrical service, which was also done 20+ years ago. My electrician, who happens to be very good and extremely honest, sat there flabbergasted as the inspector went about her business. He told the inspector that she was punishing the new owners for something they didn’t do. Of course, he’s right!
[The electrician] also told me that this recently happened to him on a job in Noe Valley. On that job, they made the seller legalize a kitchen and tear out the sheet rock and a granite back splash to inspect the wiring, which turned out to be fine and to code, however the granite back-splash no longer was. This is a relatively new development in both instances and a clear sign that the city is broke and looking for any way to generate revenue. Coupled with the sidewalk crack-fix stories I have heard lately, and never before has it become so clear that the city is on a witch hunt.
So what’s the rest of your experience with this matter? There are so few homes out there that can claim they are without fault in some way with their permit history. How do you advise a client that is either going to market a property where work was done without permits, or a buyer is looking to buy one where a significant amount of the property has been ‘updated’ without permits. This is truly a difficult matter and one that should be explored by all of Realtors in the real estate community in San Francisco as we try to best advise our clients. As time goes on, and as San Francisco tries to dig themselves out of a hole on the back of its citizens, illegally constructed additions may truly start to have an impact in ways that we are not used to seeing here in San Francisco.
Your thoughts please.
Thanks!
If we still had the 10,000 daily readers we did prior to putting this site to sleep, we’d bet we’d get some good responses. But since we’ve slowed down considerably on posting, let’s see which one of you can fan the flame of some good ol’ fashioned discussions. Anyone?
Nobody can really say why these things happen. There may be a desire to make $$$ by forcing people to go and get permits and redo work. The other possibility may be the rumored issues at the mayor’s home (I’ve heard about both electric and plumbing issues from the grapevine). I’m not connected enough to know what is motivating these actions. Nob and tube is a huge subject of debate, I’ve had every electrician who ever worked for me say it is safer than anything you could use to replace it, but inspectors and insurance companies hate it.
My understanding is that there is a history of different standards for different districts, but that has been revisited as so many areas of the city now have houses selling for seven figures and up– what was okay for a $500,000 house is suddenly an issue when that house sells for $1.5M. That could explain some of what is going on. If a certificate of occupancy has been issued, there city may actually have liability for the repairs the inspector required. It would be interesting to talk to a lawyer about that, but might also make a lot of trouble for the homeowners who are getting dinged.
I’ve also seen sidewalk fix issues that are just weird. I got orange blazed which meant the utility had to pay for the cracks around their box. Another neighbor down the block got white blazes around an identical utility box meaning the home owner had to pay for it. The only difference is that I had recently made some sidewalk repairs. Makes no doggone sense like pretty much everything about the government of San Francisco.
I’m not sure that I believe the story first of all, and without context who knows what really happened or the condition of the overall home in question.
But you are certainly taking a risk inviting an inspector into your home. My questions would be, what right does the city have to access your home without your permission. I’d say borrow a friends aggressive dog and a sick infant and put them in any room you don’t want an inspector to inspect.
“The Seller stated in the supplement to the TDS that all work on the property had the necessary permits through the course of [their] 40+ years of ownership.”
Simple, in this case. Go after the sellers for any costs associated with fixing non-permitted work. Slam dunk. Buyers should insist on such a warranty if it was not already included as it was here.
I am a city planner and have been for over 20 years. We planners see this every day. I often say that on Friday nights when the sun goes down the hammers come out–there is simply a huge amount of illegal construction going on everyday. I think new loan underwriting is going to find a lot of this kind of thing from now on during escrow. We will see. Frankly, the property owners and the real estate agents never have the information right on these matters, so my first take is that the description of the problem in this post is not correct. Additionally, agents have been doing the “as is” routine so long as if it means that they can sell anything as long as they say “as is” in their listing when in fact people are buying property that has illegal additions, etc. I don’t think that there is any conspiracy buy local goverment, but I do think that there is a lot if illegal construction taking place and the real estate brokerage business has been doing their best to ignore it or hide it.
anon has it right in terms of liability – it lies wholly with the sellers and their agent. I would ALWAYS check the “work done w/o permits” box on the TDS if anything had been updated in an older house. unless it’s clearly stated on the 3R or the sellers had receipts to prove the work, the city will consider it illegal.
As far as the sidewalks and building inspections in general, if you have to have something inspected, they can inspect as much or as little as they like. This is why everything should be done with permits. And the sidewalks have always been the responsibility of the owner and this has always been enforced, I’ve dealt with this multiple times for multiple properties and always encourage owners to fix it as they are liable if anything happens, say an injury at an open house.
Here’s a crazy idea: don’t do work without permits. The permitting process is there for a reason, I know it is extra work, but just do it.
IANAL but I would certainly be talking to one if I was the one who purchased the home.
It seems like such “inspect above and beyond” behavior will discourage people from pulling permits due to the risk of potentially exposing other more serious issues.
I recently pulled permits for a kitchen reno, and that process was a nightmare, especially for an “owner-builder” –an absurd level of bureaucracy even for an “over the counter” permit. And expensive, to boot. It was particularly charming to have the city paper-pusher tell me that the amount I said I was going to spend was “too little”, and they had a $9k minimum for kitchen renovations. I can totally see why people don’t do it. If the city made it easier and more streamlined, I think you’d see a lot more permits being pulled.