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Old 04-25-2011, 03:15 PM
 
11 posts, read 47,566 times
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Hi,

Found a house but my little understanding of NC State Law is that if a homeowner applies for a building permit and then conducts and completes the work themselves then they are not allowed to rent or sell the property for 12 months.

During the inspections it has come to light that even though permits and building inspections were signed off with the city at the beginning of 2011, general contractors were not used and the building work was done by the homeowner. It also appears that the installation not only contravenes some NC state laws but also should not have passed the inspection due to some of the materials used.

What paths can be taken in this situation? There is money already at risk due to due diligence fees but we feel the homeowner has put the house onto the market when they are not legally entitled to sell it due to the above.

Any help and guidance appreciated.
R_H
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Old 04-25-2011, 03:30 PM
 
Location: Fayetteville, NC
1,490 posts, read 5,047,855 times
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I've not heard of this law. I'm sure it would have come up in some of the training we get.

Also in my area we have not offered the DD fees and so far this year none have been demanded. Different areas are handling it in different ways. No fee is required just a matter of negotiation between buyer and seller.

I just e-mailed a termination of contract during the DD period on a house that had a lot of homeowner installed wiring and a bulging retaining wall around the pool. The wall was made of 2''x10" lumber and looked like it would bust open at any time. We did not put up any DD fee and will get the earnest money back.

Better to terminate and look elsewhere if you are really concerned about the work. There are plenty of homes on the market.
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Old 04-25-2011, 03:34 PM
 
63 posts, read 152,374 times
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Quote:
Originally Posted by Relocated_Here View Post
Hi,

Found a house but my little understanding of NC State Law is that if a homeowner applies for a building permit and then conducts and completes the work themselves then they are not allowed to rent or sell the property for 12 months.

During the inspections it has come to light that even though permits and building inspections were signed off with the city at the beginning of 2011, general contractors were not used and the building work was done by the homeowner. It also appears that the installation not only contravenes some NC state laws but also should not have passed the inspection due to some of the materials used.

What paths can be taken in this situation? There is money already at risk due to due diligence fees but we feel the homeowner has put the house onto the market when they are not legally entitled to sell it due to the above.

Any help and guidance appreciated.
R_H
I have never heard of a 12 month waiting period. The city [or county] is not going to come back and do a reinspection of something they have already signed off on. If it's signed off then it's legal.

A homeowner is allowed to do work on his own house and the fact that he chose to get permits and inspections is a sign of integrity, not dishonesty.

Frankly, it is much easier for established contractors to 'get away' with little things due to their working relationship with inspections departments as opposed to homeowners who are completely at the inspector's mercy.

Chris
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Old 04-25-2011, 04:08 PM
 
11 posts, read 47,566 times
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I have had independent conversations with contractors that have confirmed this and have found a link specifying this here for North Carolina. Rather implies you can do it yourself if you plan to live with your handiwork for a minimum period.

WakeGOV.com - When Permits Are Required Guide

With the excerpt reading :-

When must work be done by a licensed contractor?
Building Contractor Required
A general contractor licensed in North Carolina must perform all work where the construction cost is in excess of $30,000. Any person who is paid to manage a project where the construction cost is in excess of $30,000 must be a licensed General Contractor. An unlicensed contractor may perform work where the cost is $30,000 or less. Any person may act as their own general contractor for construction of a home, addition or accessory structure if they own the land and will personally occupy the structure for 12 months after completion.

Plumbing, Heating, Air Conditioning, Sprinkler License Contractor Required
A licensed plumbing, heating and air conditioning contractor is required to alter, replace or relocate plumbing or heating and air conditioning. Homeowners may perform their own plumbing or heating work if they own the land and will personally occupy the structure.

Electrical Contractor’s License Required
A licensed electrical contractor is required for all installation, construction, maintenance or repair of electrical wiring, devices, appliances or equipment. Homeowners may perform their own electrical work if they own the land and will personally occupy the structure.

R_H
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Old 04-25-2011, 05:26 PM
 
Location: Fayetteville, NC
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I was aware of the dollar amount but I suspect there is no system in place to enforce or catch someone who sells prior to 12 months. If the seller had the INTENTION of keeping the place for 12 months at the time the improvements were made I doubt the state could prohibit the sale.


It sounds like you should back out.

Last edited by faabala; 04-25-2011 at 05:37 PM..
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Old 04-25-2011, 05:34 PM
 
Location: Fayetteville, NC
1,490 posts, read 5,047,855 times
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Here is the actual state statute.

[SIZE=3]§ 87‑1. "General contractor" defined; exceptions.[/SIZE]
[SIZE=3]For the purpose of this Article any person or firm or corporation who for a fixed price, commission, fee, or wage, undertakes to bid upon or to construct or who undertakes to superintend or manage, on his own behalf or for any person, firm, or corporation that is not licensed as a general contractor pursuant to this Article, the construction of any building, highway, public utilities, grading or any improvement or structure where the cost of the undertaking is thirty thousand dollars ($30,000) or more, or undertakes to erect a North Carolina labeled manufactured modular building meeting the North Carolina State Building Code, shall be deemed to be a "general contractor" engaged in the business of general contracting in the State of North Carolina.[/SIZE]
[SIZE=3]This section shall not apply to persons or firms or corporations furnishing or erecting industrial equipment, power plan equipment, radial brick chimneys, and monuments.[/SIZE]
[SIZE=3]This section shall not apply to any person or firm or corporation who constructs or alters a building on land owned by that person, firm or corporation provided such building is intended solely for occupancy by that person and his family, firm, or corporation after completion; and provided further that, if such building is not occupied solely by such person and his family, firm, or corporation for at least 12 months following completion, it shall be presumed that the person, firm, or corporation did not intend such building solely for occupancy by that person and his family, firm, or corporation.[/SIZE]
[SIZE=3]This section shall not apply to any person engaged in the business of farming who constructs or alters a building on land owned by that person and used in the business of farming, when such building is intended for use by that person after completion. [/SIZE][SIZE=3](1925, c. 318, s. 1; 1931, c. 62, s. 1; 1937, c. 429, s. 1; 1949, c. 936; 1953, c. 810; 1971, c. 246, s. 1; 1975, c. 279, s. 1; 1981, c. 783, s. 1; 1989, c. 109, s. 1; c. 653, s. 1; 1991 (Reg. Sess., 1992), c. 840, s. 1.)[/SIZE]
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Old 04-26-2011, 05:29 AM
 
11 posts, read 47,566 times
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So we are saying that there is a 12 month rule and that is confirmed by faabala (thanks for the reference).
To one of the points mentioned above for contractors being able to 'get away' with it I would say the opposite would be true. Inspectors will be wanting the work by contractors, who are being paid, to be of a high standard and to keep everyone honest. If it is a homeowner, and they would have to live with the errors due to the 12 month period, then they may be more flexible in passing it and perhaps just pointing out some things that would need fixing before resale. If the homeowner has no intention of selling then everyone wins.

I am also hearing that as NC State laws change the building inspectors are not there to uphold or enforce these laws. They are there to inspect to minimum code standards and that the work adheres to permit specification and safety. What are the repercussions if an NC State law is not followed? Is there any comeback on the inspectors if there are obvious building code violations and state law has not been followed?

In this instance the date of completion of city inspection was 2 weeks before the property was listed on the market. Does not give an indication of an intention to inhabit the property.
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Old 04-26-2011, 08:47 AM
 
63 posts, read 152,374 times
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Quote:
Originally Posted by Relocated_Here View Post
So we are saying that there is a 12 month rule and that is confirmed by faabala (thanks for the reference).
To one of the points mentioned above for contractors being able to 'get away' with it I would say the opposite would be true. Inspectors will be wanting the work by contractors, who are being paid, to be of a high standard and to keep everyone honest. If it is a homeowner, and they would have to live with the errors due to the 12 month period, then they may be more flexible in passing it and perhaps just pointing out some things that would need fixing before resale. If the homeowner has no intention of selling then everyone wins.
I have 30 years construction experience and it contradicts your assumptions.

Chris
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Old 04-26-2011, 08:51 AM
 
63 posts, read 152,374 times
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Quote:
Originally Posted by Relocated_Here View Post

In this instance the date of completion of city inspection was 2 weeks before the property was listed on the market. Does not give an indication of an intention to inhabit the property.
It doesn't? Maybe the owner got an unexpected job offer and has to move. There could be any number of reasons why someone decides to do some work on their house and then doesn't stay.

Have you asked the homeowner for an explanation?

It sounds to me like you are trying to twist this situation into something you can take advantage of.

Chris
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Old 04-26-2011, 09:45 AM
 
11 posts, read 47,566 times
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Chris,

Thanks for the responses. We have asked reasons for moving but these requests have been denied - after all they are not required to tell us their personal circumstances.

It is not an effort to twist to advantage but rather seek clarification on what the legal situation is so that we do not get caught up in something that we would rather not be a part of. Not being familiar with NC laws then we could end up taking this on and then be hit with something further down the line that would then be our responsibility to put right.

It is a nice place and hence the reason that the interest is still there.
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