Researching a Property's Permit History Before You Buy
Any good Realtor will tell you that a home inspection is an important step when purchasing a property. Although a thorough home inspection can often catch some obvious potential issues, home inspectors aren’t able to give you all of the information about a potential property just from a visual inspection.
A step in the home buying process that often seems to be missed by homeowners doing their due diligence is checking the permit history of a property.
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Why Should You Research A Property’s Permit History?
As we discussed in How Permits and Inspections Protect You, there are numerous reasons why permits and city inspections are valuable in the remodeling process. Here are some of the most notable reasons why it is important to research a property’s permit history:
Think about it this way - generally, people who do not choose to get permits for the work on their property are trying to save money or are trying to get around doing things to code. If the person wasn’t willing to pay a few hundred dollars to get a permit for their work, it does make you wonder: what else did they cut corners on?
Even if you have the disclosures from the seller's reporting updates for the items in their home, it is still helpful to verify the dates of things like a roof replacement, electrical work, a new furnace, etc. based on the date of the permit.
It can let you know if there may be issues with the work holding up or there could be hidden issues if it was not inspected by a city inspector during the remodeling process.
If you intend to remodel the home you may have to redo things that were not permitted which could add significant cost.
The property may actually be worth less than they are asking if the space is not finished up to code but they are counting it as finished square feet.
There may be outstanding fees still due on the permits on the property.
Having the written history can help in negotiations if an issue comes to light during your inspection period.
How To Find Permit History For A Property
The best place to start is by taking a look at the city’s website where the property is located. Above shows an example of the permit history available from the City of Minneapolis. Many cities have similar ways for you to search for permits both past and present in their building permit section online.
If there is not a way to look it up online in that particular city, there is often a phone number or email address for someone at the city that can tell you about the history. If that isn’t available, consider making a stop over at city hall, or wherever the building inspector is located.
Keep in mind that every city may have a different process and each property is unique. Make sure to consult with your Realtor, home inspector, title company, and real estate attorney to ensure the proper procedure for your home purchase.
The permit history on a property can often tell you a lot about the condition of the home and give you clues into what may need further research. Checking on this history is an important part of doing your due diligence on a home purchase as it helps you to verify the information shared with you in the seller’s disclosures. The goal is that with a little extra research, you can have more confidence and appropriate expectations when purchasing a home!
Now we would love to hear from you! Are you currently in the process of buying a home or have you previously looked up the permit history when purchasing a home? What was your experience like? Share it with us in the comments below!