Unpermitted structures (Volcano, Hawaiian Acres: for sale, 2014, insurance)

[imagtek]

There are MANY unpermitted structures on the Big Island, especially Puna district and Ocean View in Kau. I can understand this, since these are areas with many low/moderate income people with minimal employment prospects whose only recourse after spending their life savings purchasing cheap land is to 'do it yourself'. Many have...

I also see unpermitted structures listed for sale in standard real-estate listings. So many, in fact, that if a structure is permitted this is often mentioned as a selling point. Some of these unpermitted structures are built very solid and appear professionally architected. I was even shown one by a realtor. It was amazingly innovative architecturally and made the permitted tract homes on slabs for the same money look like cracker boxes.

Then of course there are the ramshackle 'shacks' of scavenged material little better than tents at the other end of the scale.

Is there some sort of long term plan by the state to manage this situation and bring things into the 'system' over time? Is there a plan for some sort of amnesty or reversion of codes to earlier standards for structures built before some cut-off date? Or is there no plan at all beyond restricting access to grid-power and insurance? I cannot see a blanket condemnation of a large portion of the housing stock because the political push-back would be huge, potentially violent, and would create a homeless population and eviction nightmare. Still, at some point the state will surely have to get control of the situation. Or not?

So how is the unpermitted structure situation on the Big Island going to play out? Anyone knowledgeable about this sort of thing and the political currents in motion? I'd rather not get into discussions about how awful/stupid/etc. people who build unpermitted structures are, the worker liability hazards, etc. That is already well know.

Given the current situation, how is the huge stock in unpermitted structures going to be dealt with, in the event I wind up owning one. Some are very well built, architected and attractively priced relative to permitted structures.

[OpenD]

Originally Posted by imagtek

Is there some sort of long term plan by the state... No

Is there a plan for some sort of... No

Or is there no plan at all... No

Still, at some point the state will surely have to get control of the situation. Or not?... No

Maybe later....

[Badlanding]

I am not sure if there is a plan on a local level to actively bring up to date unpermitted structures. But I can tell you it is being done on a owner by owner basis. An example I can give is last week I had architect out to "walk my site" in Hawaiian Acres and he was telling me that he just started a job for a customer in Volcano who is bringing a 10,000 sq.ft. home up to code. The architect said that the entire home was built entirely without permits but is being brought up to code now. He also mentioned it was gonna cost the guy about $75,000. I was shown a few unpermitted homes when I was purchasing my property in 2012....be very, very careful.

Also codes are changing. I have two open permits right now. I had a concrete foundation inspection and Todd Tanimoto the inspector said that the design for my foundation is no longer being allowed by the county as of spring 2014. Like I said I am not a "expert" and can only speak from my recent experiences. Also my neighbor two lots down from my in Orchidland has a "unpermitted" home/cottage. And next to him is a guy who has lived in a bus since the early 80s or so I am told by my neighbors.

I can't imagine how the county would let the potential tax yield escape them. But what good would it do if you can't get people to follow through. It's hard to get people to "play by the rules" when often those very same people do not subscribe to the same value/rule system? They are not bad people they just don't want to bother. I have had conversations with my own neighbors who own and live in non permitted homes and it just isn't a issue. And you can buy non permitted homes but good luck getting any kind of financing it can be tricky.

Another friend of mine said that his property had a non permitted addition and he was trying to sell, but the only offers he was getting was for the appraised value of the lot and the original cottage. If it had been permitted he could have asked $150k, instead he was getting offers for $65-$75k. Good luck, I am very interested in hearing from someone who has been in Puna for a while.

[terracore]

The county doesn't have a strategy to sort this out. An unpermitted home doesn't qualify for a mortgage or insurance, so a buyer is getting vacant land, which means either paying cash, doing owner financing, or getting a vacant land loan (which is essentially the same interest rate as an unsecured loan) with a future tear down in the future. It might not be the near future, but still the future.

A completely unpermitted structure "may" be able to be brought up to code, however that might cost as much as a total re-build. Usually, if somebody is going to build a house to code, they do other crazy responsible things like getting permits for it.

What IS possible, is getting traditional mortgage financing on a home that has unpermitted additions. The additions may or may not have to be brought up to code before closing, or demolished, depending on the lender, and what the engineers and the other additional inspections they will require (usually a licensed contractor report). There are some things that they will never issue loans on, such as properties with unpermitted pools, and some other things.

Quick lesson is that you can't insure something that's not up to code, and banks won't issue loans on something that can't be insured.

The county seems to be taking the position that the economics of these situations will eventually right the ship...

Need to add, generally you can get liability only insurance on a vacant lot (if you have homeowner's insurance, and you also own a vacant lot, the policy may cover the vacant lot at no extra charge, some policies even cover multiple vacant lots, just need to give your agent the TMK #s). But if there is any type of structure on the vacant lot ...... no liability insurance. So if some stoner climbs a tree on your vacant lot, falls down, breaks their back and sues you... better not have a structure of any kind on the lot.

[OpenD]

Originally Posted by Badlanding

I am not sure if there is a plan on a local level to actively bring up to date unpermitted structures. But I can tell you it is being done on a owner by owner basis.

Meanwhile new unpermitted structures are still being built.

The issue is a longstanding absence of meaningful enforcement efforts, and staffing levels that do not really permit any more to be done. The plan reviewers and code inspectors are good people, but they're already backed up with active permits, so they have no bandwidth to go after code scofflaws, even when complaints come in from members of the general public.

It's been a feature of the local culture for decades. Until recently there weren't even significant fines or penalties for people who ignored the laws. And since the county tax assessments make no distinction between legal and illegal construction, there's little financial incentive for the county to poke any further into the situation.

In short, I don't really see the situation changing anytime soon. Nobody cares that much.

[hotzcatz]

Just because there isn't a permit doesn't mean it isn't taxed. All structures pay tax, whether they have a permit or not. The tax office is really up to date on finding and taxing structures. They are using satellite data now so they don't have to peek down driveways anymore. They even usually note which structures have permits, too, but for some reason there isn't anything in place to notify the Building Department and make the illegal structures get permits. I suppose, since they are paying tax already, it's not a huge loss for the County. The permit fee to the County isn't very much so as long as they are taxing them, then it's more or less all good.

Building permits now have an expiration date. If it's not done by the designated date, then it either has to be renewed or it becomes invalid. They used to be open ended as long as some sort of work was done every 120 days, although they didn't require verification of it.

If your structure was built before 1915 and has documentation prior to 1930, it doesn't need a building permit, even if it's a dwelling. If you do more than some amount of percentage of value of work to it, I think it was 25%, then you have to bring it up to the, was it '81 UBC (as amended by Hawaii County) codes? Might have been the '87 UBC codes. If you do more than some larger percentage of work to it, then you have to bring it up to a higher code, '93 UBC or some such. The current code is IBC which is the International Building Code, I forget the exact year, 2005 or 2006 or some such - as amended by Hawaii County, of course.

When at some point your structure requires a permit, then you get to bring it up to the current code. A building permit locks in the code standard that the building needs to be built to and the code is constantly (if however slowly) changing. So, probably the best reason to get a Building Permit is to not ever have to update the existing structure to the new codes. Some of those unpermitted buildings were built before Simpson ties were even available. Now they are pretty much required by code everywhere. So, had the structure had a permit, it wouldn't require updating. Since no paperwork was ever done, then when someone complains, they need to get insurance or a mortgage on the structure, then it will have to be brought up to code.

The County has been doing a lot of tightening up on unpermitted structures over the past several decades. I don't see a return to the Wild West days of early Puna when folks were building unpermitted structures everywhere.

Currently, as soon as someone makes a complaint, the County goes out to check on the unpermited structure and then they have to get it permitted or tear it down. But, so far, it's just complaint driven. With luck, it will stay that way, but if I were buying a structure on this island, I'd either want to see the permit for it or I'd get it permitted. For me, it's easy, though, I'm a draftsperson and know the code but doing "as builts" (drawings after the structure is built) is no fun and I'd not even really want to do it even for my own structure if I could help it. It's a huge PITA. Historically, the only "fine" for unpermitted buildings was double the permit fee (usually several hundred dollars) when the folks got around to getting a permit. Now, I don't think the fine is any much more, but they are a lot fussier about the drawings, architect/engineer stamps, meeting code requirements, etc. for "as built" structures.

[haoleexpat]

Maybe a little off topic, but what are the rules regarding living in a temporary structure [camper/trailer/modified shipping container] while pursuing a permit??
That would be my plan, as before designing a house, I would like to get the feel for the land by camping on it for a while. Or would a temporary structure raise more red flags with the dept??
Seems I remember an old rule that if the temporary structure was movable and you could simply move it a few feet and it would be legal again.

[OpenD]

Originally Posted by haoleexpat

Maybe a little off topic, but what are the rules regarding living in a temporary structure [camper/trailer/modified shipping container] while pursuing a permit??
That would be my plan, as before designing a house, I would like to get the feel for the land by camping on it for a while. Or would a temporary structure raise more red flags with the dept??
Seems I remember an old rule that if the temporary structure was movable and you could simply move it a few feet and it would be legal again.

No, that's not the rule. Letter of the law is you can camp on a property for 30 days.

The big concern is human waste, and the health issues associated with it.

[delmioquartiere]

Originally Posted by OpenD

No, that's not the rule. Letter of the law is you can camp on a property for 30 days.

The big concern is human waste, and the health issues associated with it.

So 30 days of human excrement is OK but 40 is too much?

[OpenD]

Originally Posted by delmioquartiere

So 30 days of human excrement is OK but 40 is too much?

No, the assumption is that you have some form of camping toilet... a composting toilet is ideal... but you're legally required to break camp and move on after 30 days.