Permitting Pitfalls

Realtor ® Attorney Joint Committee

Permitting Pitfalls

By Paul A. Blucher, Esquire; Blucher Law Group, PLLC

The preprinted Florida residential purchase contracts (FAR/BAR) contain language relating to governmental permits, open permits and address permit cost limits or liability. Paragraphs 9(a)(iii) and I0(b) of the FAR/BAR Standard Contract, and paragraph 12(a) & (c) of the As Is contract address permits and distinguish primary differences in these two contracts. Permits are typically required for structural improvements, electrical, plumbing and even some minor remodeling projects. On occasion, improvements are made by property owners without a permit or owners do not properly close out a permit, which can create a problem in real estate transactions.

If a project is planned that requires a permit, the contractor or property owner must obtain a permit before the work begins and upon completion of the project, have the work inspected to close the permit for that particular project. If the owner or contractor completes work on the property without obtaining a permit, and does not disclose

the work to the purchaser, the seller may become liable to the buyer should the lack of a permit create an issue for the buyer later. The typical Seller's Disclosure specifically makes an inquiry to see if the seller has had any work done or if they are aware of any open or un-permitted work that has been completed on the property. Nonetheless, it is generally the purchaser's responsibility to perform due diligence and ensure that all required building permits have been properly issued and closed for any improvements to the property during the inspection period.

Your closing agent should advise you if there are any permit concerns before the inspection period ends. There should also be communication and cooperation among your team to fully review the property and protect the purchaser. Your inspectors and your surveyor should be able to tell you if improvements have been made, and then you need to check with the government authority or your attorney to see if a permit was required and obtained for those improvements.

Caution: Improvements made without permits may cost you later if issues arise regarding property and casualty insurance, future remodeling, or the future sale of the property and, of course, serious harm and damages that could occur due to faulty or inappropriate construction. Many times the purchaser will look to their Realtor

® to advise them on these issues. As a Realtor

® to properly represent your customer, you should be mindful of any potential permit issues in the transaction and always disclose.

HERE ARE SOME QUESTIONS TO ASK:

1. Has the seller made any improvements to the property since purchasing? (for example look at the roof, garage door, HVAC system, kitchen, bathrooms, windows and doors, and storm improvements, as compared to the year the home was built.)

2. Has the seller expanded the square footage of the home?

3. Has anything in the yard been changed since purchasing the home such as adding a well, garage, utility shed, pool, or fencing?

4. Has anything been enclosed?

5. Look around, does anything seem out of place or different from the rest of the home?

This article is not intended to serve as legal advice and should not be used as a substitute for consultation with an attorney.

12 JULY 2018 Sarasota/Manatee REALTOR® Magazine www.MyRASM.com