Unpermitted Remodeling Concerns
It’s not uncommon that Portlanders have work done to their house, or do work themselves, without obtaining a building permit. Nearly any remodeling in Portland requires a permit, but many people don’t follow these rules in order to avoid the hassle and permit fees.
If you are purchasing a house that has had remodeling that was not permitted the dangers are four-fold:
- The work might not be done to code (no official body has check for that) so there are potential safety or workmanship issues.
- If the city finds out that unpermitted work had occurred they might require you to permit the work as if you were doing the work today.
- If the house had been significantly improved but not reported to the county, then it may be taxed at an insufficient level if the market value is well above what the county considers it to be.
- You may find that when you go to sell the house that there are buyers that are uncomfortable purchasing a house with unpermitted work for the three previous reasons.
In our experience, is unusual that the county makes a homeowner pay back taxes for a house that was insufficiently taxed, but we believe that the county holds that out as a possibility. Sometimes unpermitted work is known about by the tax assessors and the home has been taxed properly even if the work was unpermitted. It is common to see 2 bathroom homes taxed as 2 bathroom homes, even though there is no permit on record for the 2nd bathroom.
The most likely repercussion is if the city finds out about the unpermitted work, they will want you to get the work permitted. It is unlikely that the city will find out about the work unless you are having other work done that you ARE obtaining permits for. That’s when inspectors that come to inspect the new work might notice that there is other work that is not shown in their records.
The city inspectors are very helpful with this process, but it will be some hassle, time, energy, and expense. You will have to:
- Pay the permit fees based on how much the city thinks it would cost to do the project in today’s market.
- Submit architectural plans that show the scope of the work.
- Have to have the work inspected. That may include opening up small wall areas for inspections to the plumbing, structural, and electrical components.
- You may have to correct items that aren't to code in order to get the permit closed
- The best way to research whether a home has unpermitted work is to research permits online at www.portlandmaps.com, and also to do a records search downtown at the Bureau of Development Services.
We've gone through this process with both buyers and sellers, and it can delay closings and even cause transactions to fail if the buyer wants everything squared away before closing and the seller refuses to do it. Some buyers choose just to move forward and deal with permitting on their own when it becomes an issue, depending on how much work was done and how comfortable they feel with taking on these potential future costs. Other buyers decide to walk away from homes with extensive unpermitted work feeling that it is not a risk that they want to take.