Home improvement plans not filed with town?

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Paddington79
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Home improvement plans not filed with town?

Post by Paddington79 »

Hi Again - slightly different topic re home improvement technicality:
The house we are looking at to buy is registered in the town assessors' database at 1000 square feet.
Yet current owners made significant additions and upgrades (finished the basement, added a bathroom) upping the square footage and the value, in theory - but the town deed site does not reflect this.

Is it mandatory that an owner file improvement plans with a town, and if it's not registered...does this mean the upgrades are somehow not legitimate? Basically don't want to pay for a 1400 s. foot house that is seen in the eyes of an appraiser and the town as 1000 sq. feet. Not sure how to proceed?

Help? Thanks again.
-Paddington
jebmke
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Re: Home improvement plans not filed with town?

Post by jebmke »

I always keep copies of the permits issued for home renovation. You might ask the seller for a copy.

I have moved a lot - in some cases, shortly after the purchase the local assessor set up an appointment to survey the property for the next assessment. I don't think you want to go into a deal assuming that the assessors will not discover the current condition of the property.
Don't trust me, look it up. https://www.irs.gov/forms-instructions-and-publications
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Paddington79
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Re: Home improvement plans not filed with town?

Post by Paddington79 »

I am hoping that an assessor would discover it - my issue is that I don't want to buy a property that has been undervalued by the town. Is there a way to get a more up to date assessment before purchase, do you know? Thanks... - Paddington
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NateH
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Re: Home improvement plans not filed with town?

Post by NateH »

Below ground square footage is not "counted" by some municipalities.

Also, the assessor will update the home's value based on the sale, regardless of how many square feet is in their database.
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NateH
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Re: Home improvement plans not filed with town?

Post by NateH »

I would check if the owners pulled a permit for their improvements, since you are looking to buy the house.

Don't know about the city in question, but permits are listed online by some cities, searchable by address. You could find out without even asking the sellers.

The information that a permit was lacking could be an advantage in negotiations, since you would be taking on additional risk that things were done correctly to code.
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Re: Home improvement plans not filed with town?

Post by Jack FFR1846 »

Be sure.

Bob Vila's addition in Boston resulted in a "tear down" ruling by the city for the next owner. Not sure the outcome but here's a story on it.
http://www.apnewsarchive.com/1987/TV-Ho ... 027fccef9f
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Kosmo
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Re: Home improvement plans not filed with town?

Post by Kosmo »

Basements generally don't count as square footage unless there's an at-grade entrance (full size door to walk in and out of). Was all the work done in the basement? Adding a bathroom above grade, but not changing the footprint or roofline of the house usually removes square footage. What would concern me more is if the town didn't have any record of the improvements. If they were made without a permit then they weren't inspected. Also getting a building permit usually triggers an assessment, so check to see if the time time frame of the last assessment matches the time the when the improvements were made.
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Re: Home improvement plans not filed with town?

Post by pshonore »

NateH wrote:Below ground square footage is not "counted" by some municipalities.

Also, the assessor will update the home's value based on the sale, regardless of how many square feet is in their database.
That totally depends on local policy and never happens in Connecticut. By law, houses and all other property is reassessed every four years.
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mhc
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Re: Home improvement plans not filed with town?

Post by mhc »

My concern would be if there was no permit, then there was no city inspection. If there was no inspection, who knows what the owner did. Did he follow code? A lot of people are hacks in doing their own work. That is fine as long as the owner lives there. New owner beware!
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pshonore
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Re: Home improvement plans not filed with town?

Post by pshonore »

Kosmo wrote:Basements generally don't count as square footage unless there's an at-grade entrance (full size door to walk in and out of). Was all the work done in the basement? Adding a bathroom above grade, but not changing the footprint or roofline of the house usually removes square footage. What would concern me more is if the town didn't have any record of the improvements. If they were made without a permit then they weren't inspected. Also getting a building permit usually triggers an assessment, so check to see if the time time frame of the last assessment matches the time the when the improvements were made.
How does adding a bathroom decrease sq footage? Most assessors measure property by the outside measurements of the foundation/dwelling to come up with sq footage with additons/subtractions for nooks and crannies. A finished basement will increase the value of the dwelling by $x per sq foot of the finished basement area. Other features such as decks, porches, garages, etc are assigned a per sq ft value and add to total. $X is added for each bath, each fireplace, central air, etc. At least thats how its done where I live. Other locales may do it differently.
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Jay69
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Re: Home improvement plans not filed with town?

Post by Jay69 »

This happens around here all the time, home Owner buys a new house with an unfinished basement with plumbing and electrical roughed-in then the home Owner finishes off the space at some point, generally after the assessor has made a visit. Then they hope the assessor does not come around and or forgets about them. The next time the assessor show up the taxes go up.

We get a visit from the assessor about every 5 years. So in theory the assessor could be off by 5 years.
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Kosmo
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Re: Home improvement plans not filed with town?

Post by Kosmo »

pshonore wrote:How does adding a bathroom decrease sq footage? Most assessors measure property by the outside measurements of the foundation/dwelling to come up with sq footage with additons/subtractions for nooks and crannies.
You're correct if they do it that way. If you have to move or modify walls to accommodate plumbing/HVAC/electrical/etc. then you lose actual (internal) square footage. May not correlate with assessed size. Depends on how the assessor assesses. So...ignore my statement about size.
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Re: Home improvement plans not filed with town?

Post by rustymutt »

Be careful that your property taxes don't shoot up based off the sale inspection.
He may be hiding details to keep his taxes down. When sold he'll loose this ability, and you may see taxes go way up.
Just a thought.
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WhyNotUs
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Re: Home improvement plans not filed with town?

Post by WhyNotUs »

Ask the owners whether the improvements were done with a building permit. Don't go to town first or you may create problems for the owner.
If not, after contract, prior to closing have an inspection contingency that allows your inspector to open and repair any walls necessary in order to assess safety of the improvements. It may cost you some money but the only way that you can make sure before putting your children in there absent an electrical and plumbing inspection.
+1 on radon test during inspection.
Know that this issue could return when assessor visits. A post-occupancy inspection can sometimes be performed on these units as the structure was already inspected when originally constructed and they should not have changed load bearing. That leaves plumbing and electrical. It was most likely plumbed for future finished basement, which means that focus will be on connections to main. Electrical is a stickier wicket. Contractor, if any, cannot come forward and say they did it for obvious reasons. Post-occupancy inspection requirements will depend on local government policy and inspectors attitude. You would be the unsuspecting new owner trying to make things right.
There are lots of these finished basements without inspections around but that don't make it right.
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DiscoBunny1979
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Re: Home improvement plans not filed with town?

Post by DiscoBunny1979 »

Where I live, many people finish off their garage as an additional "living space" and then add another covered parking space or garage with permits to make it 'legal'. But many people do not go through the Permit process because they don't want their property tax bill to increase (property tax bill is based on square footage and more than a certain amount can trigger an additional 'school tax' assessment) OR because they just don't want anyone to know what they are doing (even though renovations cause noise in the neighborhood). The thing is, an assessor will never know about the improvements or the increase in square footage until the Permit Process has been completed because it's up to the building and safety department to inform the county of the additional 'legal' living space. Then, the county records are changed to reflect the improvements.

Many real estate listings do note the additional 'living space' and try to sell the house as such even if the Permit process was not followed...because a real estate 'professional' sometimes don't want to know the intimate details of the house's history so they can claim they did not know, have no knowledge, etc. Therefore, it is buyer beware. Research. Have your own inspection done. If Permits were not taken out, see if the improvements can qualify for additional living space if a post inspection is done. Sometimes all you have to do with some things - like a closed in porch - is to submit plans of what the construction is, making sure the additional has adequate footings, and they might approve the square footage as living space without a formal inspection. It all depends upon location. See what your building department requires.
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Paddington79
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Help, please.

Post by Paddington79 »

[Thread merged into here, see below. --admin LadyGeek]

Hi. I am so sorry to start a new thread but this might be easier. Oy.

So the house we want to buy is assessed by our town at 1,000.

The actual living area is 1,400. This is because former owners (not current ones from whom we'd buy) finished the basement to add a bath, bed etc.

For some reason our town's assessor doesn't have a record of this (though Zillow does reflect the new size).

We will obviously get an inspection to make sure it is up to code. I am not worried about inspection.

My question: Are we making a mistake paying 1,400 sq foot prices for what is *recorded as* a 1,000 sq foot home? Should we base our offer price on the RECORDED square footage or the true in-person square footage -- and could we get [taken advantage of --admin LadyGeek] if we tried to re-sell? Thanks again. -Paddington79
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Re: Home improvement plans not filed with town?

Post by rogermexico »

Your property tax total is directly correlated with city assessors square footage (which can differ from what a realtor would put as sq. ft). So from a financial standpoint prior owner may be doing you a favor. Have your home inspector look very closely at the basement (to guard against code violations). In my area assessor doesn't inspect interior on change of ownership. These are done on 2 year cycle and in most cases no interior appraisal is done unless you challenge assessment. Normally you have a choice as to whether to allow an interior inspection (as opposed to a drive-by assessment). If you have additional finished sq. ft that are not on your property card, you're probably better off with the drive-by.
You could probably check with town's building division to see if permits were pulled (in my major city such records are public and available online). That'd be better than going to the assessor.
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Re: Home improvement plans not filed with town?

Post by barnaclebob »

nevermind
Random Poster
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Re: Home improvement plans not filed with town?

Post by Random Poster »

Paddington79 wrote:Hi Again - slightly different topic re home improvement technicality:
The house we are looking at to buy is registered in the town assessors' database at 1000 square feet.
Yet current owners made significant additions and upgrades (finished the basement, added a bathroom) upping the square footage and the value, in theory - but the town deed site does not reflect this.

Is it mandatory that an owner file improvement plans with a town, and if it's not registered...does this mean the upgrades are somehow not legitimate? Basically don't want to pay for a 1400 s. foot house that is seen in the eyes of an appraiser and the town as 1000 sq. feet. Not sure how to proceed?

Help? Thanks again.
-Paddington
Seems like yours is a good question to ask your realtor.

Or, if you don't want to go that route, call up the applicable city planning, building inspection, and appraisal departments, and ask them the query. Give them a false address, if you are really concerned.
scone
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Re: Help, please.

Post by scone »

IMO you should base it mostly on recent comps* in the neighborhood, not so much on square footage. A small house tends to have a higher square foot cost than a larger house anyway, because some of the costs are fixed. So if you go strictly by square feet and all the other houses are much larger, that can be misleading. In any case, there are so many other factors, such as condition, location, features, negatives, etc., you really shouldn't get overly hung up on this one metric.

* By comps I mean houses that are similar and have actually sold in the last six months to a year. Obviously, you want sold prices, not asking prices. If you are using a realtor, that person should have the info readily available. Some places have an open MLS so you can look it up for yourself. Good luck.
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Re: Help, please.

Post by Quickfoot »

You may have some trouble reselling it at the higher square footage if the city / state don't agree it is that size. I'd get it rectified with the government before putting in an offer. In some cases lenders will limit the house being valued at the size it is appraised at, it can be a pain to deal with that when you go to sell. If the government doesn't have full records of the the updated finished space it may also indicate all necessary permits weren't filed.
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Re: Home improvement plans not filed with town?

Post by LadyGeek »

FYI - Merged the OP's 2nd thread back into the original. It's much better to keep all of the information in one spot.
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