Building Permits: When Are They Required?

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Prior to selling a home, a large portion of homeowners remodel a portion or all of the home to improve the property value. From a new deck to a finished basement, it is important that homeowners obtain the required permits before a project begins. Even with reputable contractors, permits are the responsibility of the homeowner. As well, after the project has been completed, an inspection is required to verify that all the work meets building and safety codes from a local inspector.

Often, homeowners complete projects without permits, either because they’re unaware that it’s required or because they try to save money and hope the town doesn’t notice.  This becomes a problem when selling, as many buyers want to see all the permits pulled for the renovations to ensure the home is up to code.  If the appropriate permits weren’t pulled, costly issues could arise with the sale of the home.

When is a building permit required?

According to the Massachusetts State Building Code (780 CMR, Section R105.1) building permits are required to “construct, reconstruct, alter, repair, remove, or demolish a building or structure; or to change the use or occupancy of a building or structure; or to install or alter any equipment for which provision is made or the installation of which is regulated by the Massachusetts State Building Code.” Essentially, if a project is going to affect the structure or utilities, a permit is required to ensure a safe final product.

It is important to realize that each town has different rules and criteria for permitting. It’s recommended that owner’s reach out to the town building department to clarify whether or not their project requires a permit. In this particular situation, it’s better to ask now than to have to apologize later.

Why are permits important in the sale of a home?

If you plan on selling a home, then the need for a permit is even MORE important. When looking into the records of a home from the side of a home buyer, they will want to see records of every renovation.

The reason home buyers are so interested in seeing permits from renovations is that they can often go to your local town hall and see a report card style folder called a “permit jacket” with everything that has been done in the past. Sometimes home buyers won’t purchase a house that didn’t get permits for a specific job because in their eyes it means the project wasn’t done correctly.

There are also certain lenders that require appraisers to get permits on any home improvement job that is over a certain amount of money. So, if you have done a renovation and want to benefit from it, be sure to get a permit or the loan could be denied and your deal could fall through.

Home appraisers may ask for permits:

The appraiser’s job is to accurately describe a property and to assign a value on the home. If they see some discrepancy between what the public records say and what your home has, then they may ask for permits about the renovations. For example, if your house originally didn’t have a porch but you are listing your home with a porch, the home appraiser will realize this is new and can then ask to see the permits.

Putting Your Home on the Market:

If you have made substantial home improvements over the years and obtained the permits, be sure to have them handy throughout the entire home sale process. During the seller’s statement of property condition, there is a section that asks if permits were obtained.

Even if you aren’t thinking of ever selling your home, if there is ever an accident or fire, your home insurance may not cover the claim. If the incident can be traced back to a non-permitted home improvement that doesn’t meet the building code, you’ll be paying out of your pocket more than you could imagine.

It’s ultimately in everyone’s best interest to pull permits.  Even though it’s an additional expense and step in what’s usually a tedious process of renovations, the long-term benefit is a smooth closing when it comes time to sell.

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