question about property value & taxes (Houston, Howe: sale, HOA, insurance)

[lifertexan]

I wish I knew more about CA codes to tell you,but I don't.One thing I would do is ditch the realtor and sell the house myself.Here in TX if you use a realtor it costs you 6% of the selling price,all out of the seller's pocket.It doesn't sound like she is doing her best for you.Decide what you want for the house,add a little to come down some in a negotiation,and put an ad in the paper yourself.If places to live in CA are as expensive as everyone says then I would think you would not have a tough time selling a reasonably priced home to a young couple.Let them figure out how to get financing.I can't see how you could get in any legal trouble since the unpermitted work was done before you bought it.Sell it yourself and let the buyers figure out how to deal with all of that.Good luck.Let us know if we can help with any questions.

PS,out here in TX there are people who advertise for buying older homes to fix and resell.You might contact one of those there and see what they offer.

[Just Lookin]

We had it up for sale by owner for a month. I didn't sell. They would call and ask the price and wouldn't come in. So, we thought it would get more contacts if we hired a Realtor. I was one of those people who didn't like Realtors because of many years of them just kicking back and not doing a thing. She is new. I think that is the problem. WE ARE HER FIRST LISTING. (: I hope she gets it sold. I can't very well get out of the contract now. Its only a week in a half old.

Yes, we are giving them 6% of the price. $16,500 is a lot of money that we are not taking with us.

Thanks

[momof2dfw]

She is trying to avoid getting sued and keeping you from getting sued. "Full disclousure". She can not put something on the info sheet about the house/property if it is not true otherwise she can get sued and so can you. This is probably why she has not also put it in the paper. If someone calls to get info about the property, what can they tell them? She may not be the one getting the call everytime either. She is doing a CYA, imho. Call the city/county and ask about what one would do if some work was done on a house before you bought it and the owner that did not do the work did not get it permitted. You don't have to tell them where you live or give them your name. If they press just say you are looking at a house and this was brought up and you just want to see what you need to do or the seller. Then it may be worth $350 to have it inspected so that everything jives. Yes, FHA is PICKY!!! They will not approve a loan/mortgage for property if it needs repairs. They will usually only fund after they have notice (receipts and/or reports) that all work has been done. By cutting out any buyer that is going to go FHA you may be losing a large segment of the buying public. FHA will require an inspection and they will see if work is not properly done and such. Their inspectors can be some of the most stringent.

Yes, listing w/ a realtor will get you more exposure. Especially for buyers coming out of the area. They can find the property on the internet before they even make a trip out. And when they make a trip out they may already have a list of properties to visit. They will only see yours if they happen to stumble upon it.

Good luck

[momof2dfw]

Originally Posted by marksanders

I believe if you do interior work yourself, like adding wood floors, granite countertops, changing all the cheap cabinets that were standard at the original construction and putting nice oak ones or adding an indoor spa, which would add thousands of dollars to the value of your home, I can't see how they could know anything, as long as you do not pull a permit.

If you do the work yourself on interior work, no they will not know. But when you buy a house that is already existing that has these interior upgrades the tax office has a copy of the MLS listing and they can see EVERYTHING that the listing realtor wrote about the property. Of course if you are trying to sell your house w/ all of these upgrades you want it listed on there and you want the buyer to pay top dollar for your house w/ the upgrades.

[Just Lookin]

Thanks Momof2, The place is in great shape. We have redone everything, just not the permitts. We are doing a Full disclousure of the house and property. All the things that are listed is disclosed. I signed a disclosure form with her just like the owner who sold it to me. So now it is on two forms.

I don't know. I am getting discusted.

Thanks anyway.

[Just Lookin]

I just talked to the Realtor. I asked her if she was afraid of getting sued. She said not that wasn't what she was worried about. She said, she call a lender and they told her that without certs they wouldn't lend. That is certifcation on the block wall under my mobile. I called and found out it cost $1000 to permit the foundation. Boy, that makes me mad. The owner before me didn't have to pay.

I told the Realtor I would get under there and take pictures. Will that end this mess? She said it would help.

[Trainwreck20]

This sounds odd, but I really don't know CA law, either. Here, you disclose it and the banks/appraisers/buyers make the decisions, as long as it isn't FHA. Most appraisers I have dealt with come out, take some pictures, look at the neighbors appraisals, and write something down. They do not at all get into permit issues, for sure. They COULD as about the stability of the foundation, but an engineer could do that without getting a permit and would be much cheaper. The banks go entirely on what the appraiser says, from my experience.

Can anyone prove when the foundation was built? Is it (or could it be) grandfathered in any way or per-date the requirements for a permit?

[Just Lookin]

The only thing we have is the year of the mobile so that would be when the last owner put the foundation in. 1984

The Realtor came again today and got the pictures we took under the mobile. it looks great under there. Clean also. (surprised) Her only problem is that Lenders won't lend money without Certifications. We just need a cash buyer like we were 7 years ago.

I am concerned that the appraisers will not count the add ons. It will go down to the original 924 sq ft it was instead of the 1500 it is now. They do that here.

[RCL]

Originally Posted by lifertexan

I'm not sure I understand this.Real estate appraisers that work for real estate agencies are private entities,not arms of the government,and so should only look at the construction of the house and not whether a permit was pulled to expand it.Somebody seems to be giving you wrong info.I would change realtors,as it sounds like yours may be trying something on you like getting you to sell low to a friend of theirs in order that they can turn around and resell for a profit.Banks that give you the loan hire their own appraisers to look at the property,so again,they have nothing to do with any permitting process.Besides,if you bought the house in this shape and had a title survey done when you bought it then I don't see how they say you will have problems.Somebody is jacking you around.Get more opinions from other experts.

Real estate appraisers in CA are regulated by the State and must follow strict guidelines when appraising.

If a property has been added on without permits, or if an amenity was added such as using existing square footage to put in an additional bathroom...and there was no permit...then the deed on file with the county assessor will not be reflective of the new work or new square footage. For example, if you start with 1000 sf and add on 500 sf without a permit, whenever you go to sell (or if you try to refinance), the bank doing the loan will look at what the deed says and go by that.

The appraiser can make note that additional living space has been added, though, but for the valuation they look within specific guidelines of cost per square foot and if it's appraised high, then the bank wants to know why.

With the mortgage market tightening up, banks are very becoming very particular. Also, when things are done without a permit, the bank may deny a loan because they may suspect that it doesn't meet code regulations, or perhaps even zoning regulations. The bank doesn't want to lend on a property based on 1500 sf and then later if the county/city finds out about it and it's not within zoning (if you add a second unit, for example, or if you add a room and the home no longer meets the setback requirement), they can make you tear it down...and that could possibly leave the homeowner upside down in equity and raise the risk of foreclosure if times get tough and the owner can't continue to make payments.

I've seen this happen a few times in my old neighborhood in CA where there were lots of people doing work on their homes without permits...adding on bonus rooms for family members and converting closets to half-baths, etc. One guy in my block added an illegal unit behind his house and the city made him tear it down because of zoning restrictions.

Sometimes adding a bedroom you'd think what's the big deal, but one community I know of in CA has a requirement of 1 covered parking space per bedroom, which means if you add on a bedroom then you need to build another garage or expand the existing one and if you don't have enough room to do it, then you are SOL. Same thing goes for maximum footprint. Where I lived, the requirement was no more than 65% footprint of the lot for structures...and anything more than that required a formal variance hearing.

When the market was going up rapidly, banks were much more lenient in overlooking potential problems because they knew that (1) the property would be worth 50 thousand more in a matter of months due to demand, and (2) if one bank didn't approve the loan, the homeowner or buyer had several more lenders waiting in line ready to close. So, if the bank wanted the business, they just accepted the conditions. Most people were re-financing every 1-2 years anyway, so the banks were confident that they would get paid off...and/or if the owner/buyer got into a situation where they couldn't make the payments, they would just put the property up for sale and it would sell within a day or two, and usually with multiple offers well above asking, so the risk of foreclosure was very low.

That's no longer the case.

[Just Lookin]

Wow RCL, Thanks for spelling that out so well. That is what happened to me. No permits and no Lender. So we have to sell it to a cash buyer like we bought it. Very scary too because you don't won't anyone finding out.

Now that it has slowed down here in Calfornia I'll have to wait it out. Darn hubby just wouldn't do it when real estate was hot.