Would you buy a house if Former Owner finished the Basement?

[Steve Demuth]

Based on all the comments here, I am definitely going to leave selling our home place to my kids, after I'm dead. I have personally done 100% of the plumbing, at least half of the construction, and way more than half of the electrical wiring on our farm, including the main house, since I started building it 40 years ago (before any kind of building permit was required here, for anything). The septic systems have of course been professionally constructed and inspected, and I've gotten permits and inspections on the electrical where it was required (really only for service entry builds) but overall, most of the place is owner built and maintained. I'm guessing, from what I'm reading here, and my experience selling my parents' almost new home across the state line, that realtors and inspectors are going to have a field day when this place moves.

[Brian Elfert]

I would have to be really desperate in selling my house to let someone start cutting holes in my walls. A home inspector is generally not supposed to do any sort of inspection that is intrusive.

[Prashun Patel]

I originally finished my basement without a permit and added a bathroom that I DIY'd. The issue for me is not the quality of the work, but the liability. In my town, once you are code approved in my town, you are not on the hook to make modifications as the code changes. If something is not to code, then when you go to make changes or sell, you are liable to bring it up to the current code. Further, should anything go wrong, there is a chance insurance won't cover an unpermitted change.

I ended up "coming clean" with the township and filed for a permit after completion. Fortunately I had to make minor changes.

If I were your kids, I'd ask the seller to schedule an inspection and to pay for any modifications.

If and only if the seller balks, I would then make a decision whether I want the home enough to take the risk.

[Roger Feeley]

I know because I bought a home that had been the basement finished by the owner. He was a blowhard who did the work himself. He heated and cooled the lower level by tying into the existing HVAC. He forgot one thing and that was returns so that lower level would never get warm. I finally installed a min split to make it habitable in winter.

When we built our house, I had the builder omit returns in my basement shop. The two hvac vents down there do a great job of heating and cooling. The return is a filter size hole in the stairwell. Everything else is really well sealed. I blow out or change the filter every few months. We don’t see any dust in the rest of the house.

[John Lifer]

I'm just telling you what happened. I saw it myself. I talked to the owners of the homes myself. It wasn't city inspectors. It was home inspectors hired by prospective buyers who saw the basements and said, "No bueno!". This was before the crazy housing market when people were buying houses with no inspection. The real estate agents advised nobody would by the houses if the basements weren't up to code; which they weren't.

You think they ripped out their basements for no reason? Huh? (Just being silly here.)

Again, I'll say BS. No home inspector can require anything. All they do is visual inspection and file a report with the person who hired them. If there was stuff pulled out, then there most probably was water intrusion and they pulled damaged drywall and studs. I've sold two homes, and the first one had an inspector that had about 50 junk items listed. I replace One Breaker outside and removed a hot water switch they didn't like. Everything else was fluff to prove they looked at it. The current home I paid for inspection just because it had chimney and a basement. He found nothing. I found several things since that he should have seen, but nothing of real concern. But it DOES totally depend upon the location. Here and in MS it doesn't matter. I've partially finished my basement since moving here, it already had bathroom and crap drop ceiling. Not worried a bit.

[Jim Becker]

John, you are correct...a home inspection as part of a real estate transaction is so that the buyer can ascertain if there are any glaring deficiencies and then either decide to bail or negotiate with the seller for additional consideration to help with the cost of remediation. IF it's listed as a contingency on the RE contract. The buyers of our previous residence did have an inspection done, but it was checked off as an "informational" inspection and was not a legal contingency on the property. They could not back out of buying because of anything in the inspection. The inspection we had done here at our new place was set up as a contingency...and we were able to garner an additional $7K off the offer price because of some things that really did need to be corrected. (our actual cost for that was much lower because I did the work after settlement) In neither case was a local jurisdiction involved with the inspections or transactions. The one exception to that here where we live is septic inspection which can affect a sale and is not optional for any property with on-site septic.

Where a local jurisdiction could come into play is where a new owner pulls a permit for a new project and it becomes obvious that something done previously was, um...not done correctly and/or without a permit where it was required to have one, during inspection of the new project in the same area so it's visible to the inspector. What requires a permit is absolutely "local" in nature.

[Curt Harms]

If there was plumbing involved, the risk is larger, because that's "the one thing" that pretty much universally requires a permit. In many jurisdictions, there is less concern or even no requirement if it's just floors, walls and electrical...it depends upon the specific jurisdiction. So your daughter and her husband, with the help of their Realtor, need to ask the jurisdiction directly what is required to heal any permit situation as that should be at the cost of the seller.

I would personally be more concerned about electrical screwups than plumbing screwups. I can't think of a plumbing problem that would result in a call to a plumbing equivalent of the local fire department.

[Jim Becker]

I would personally be more concerned about electrical screwups than plumbing screwups. I can't think of a plumbing problem that would result in a call to a plumbing equivalent of the local fire department.

I'm with you there, but many of the local jurisdictions don't require permits for incidental electrical work which is what commonly gets done in projects like this thread talks about. I will say that when we bought this house three years ago, the very first things I needed to fix were some VERY SCARY electrical things that the previous "weekend warrior" did...including wire nut splices in walls and romex run along a baseboard with spackle over it to hide it. And all of the outlets I've replaced were using "push in" connections on the back which was sketchy on some. That dates back to the original builder in 1993.

[Bill Dufour]

My town used to have a good site showing what you needed permits for or not. Now it is no way to know everything is call and find out. Used to be a 100amp panel or larger changeout required no permit. under 100 amp a permit was required. Has that changed. I have no idea.
BilLD

[Brian Elfert]

I don't think Minnesota technically allows any electrical work without a permit with one exception. My understanding is a contractor can remove and reinstall light fixtures and receptacles if they are replacing siding, drywall work, or the like. They can only reinstall the same fixture or receptacle. A replacement fixture or receptacle would technically require an electrical permit, but I am sure many contractors have installed new light fixtures and receptacles while doing other work.

Electrical permitting is a state thing in Minnesota.

[Perry Holbrook]

I don't think Minnesota technically allows any electrical work without a permit with one exception. My understanding is a contractor can remove and reinstall light fixtures and receptacles if they are replacing siding, drywall work, or the like. They can only reinstall the same fixture or receptacle. A replacement fixture or receptacle would technically require an electrical permit, but I am sure many contractors have installed new light fixtures and receptacles while doing other work.

Electrical permitting is a state thing in Minnesota.

I want to make sure I understand this. Are you saying that if you go down the electrical isles at Home Depot or Lowes, that all those people buying wire, light switches, light fixtures or wire nuts, etc, need to have a permit before they can use them? I'd say it would be very rare (except for some contractors) here for anyone in those isles having permits.

[Mark Wedel]

Permit requirements vary location to location. But a lot of people do minor stuff that technically require permits, but almost no one ever files a permit for it unless it is part of some larger work.

In many places, replacing an outlet or light switch does not require a permit. Adding a new outlet might, but lots of people might add one without a permit. Replacing a water heater probably does every place, yet home depot is selling those and I imagine a lot of folks are replacing their old ones and not pulling permits for it. But for those, at least after the fact, it is pretty easy to look at it and see if it was done safely/properly, so I'd be a bit less concerned buying a house with the homeowner replace the water heater without a permit vs them doing electrical or plumbing work which is hidden behind drywall.

[Brian Elfert]

I want to make sure I understand this. Are you saying that if you go down the electrical isles at Home Depot or Lowes, that all those people buying wire, light switches, light fixtures or wire nuts, etc, need to have a permit before they can use them? I'd say it would be very rare (except for some contractors) here for anyone in those isles having permits.

They sell all kinds of stuff at Home Depot, Lowes, and Menards that technically require a permit to install, or is simply not legal to install. For example, flexible water heater connectors are not legal to install in Minnesota yet you can buy them at pretty much any store that sells plumbing supplies. You could buy all the lumber and materials to build a house from Menards, but most jurisdictions would require you to have a permit to build a house.

It appears that homeowners can replace receptacles and manual switches without a permit. Anything that requires installing wire is technically going to require a permit. For example, you can replace an existing receptacle with a new receptacle without permit, but you need a permit to install a new receptacle in a new location. Not that plenty of homeowners don't install new receptacles and switches in new locations without a permit.

[John C Cox]

Check the local jurisdiction for the specific laws. Specifically, some places strictly require permits for everything and some don't. Further, some locations "Grandfather," unpermitted work after some period of time - often 10 or 15 years, while some never grandfather anything. I've been in both places. In nearly all cases, Caveat emptor strictly applies. Once you buy the place it is legally YOURS, and you are responsible for any and all problems unless there was specific wording in the contract that says otherwise..

With the current, massive housing shortage, that's hard because properties are often under contract the day they are listed... But... In the case where you don't have time to do proper diligence prior to the offer, you better protect yourself by putting exclusions in the contract.

The moral of the story is: Buyer beware. It is the buyer's responsibility to do due diligence and make their offer accordingly.