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No Certificate of Occupancy: To Inspect or Not

By
Home Inspector with EKAN Home Inspection CPBC #69177

Recently I was asked to do an inspection on a four year old townhouse that did not have a certificate of occupancy. The buyer wanted a property inspection done along with a cost estimate to complete the outstanding work. To further complicate the issue, the building was being lived in, which is illegal.

Unfortunately I had to decline. Here's why.

Let's first discuss the construction completion process. At the end of construction, the contractor calls the architect (or other responsible party for the design) to do a final inspection. If everything is in order, the architect issues the completion certificate along with a package of engineers' documents that have all the stamped drawings and calculations that confirm that the building has been built according to design, standards and codes. The architect also issues a "punch list" of deficiencies found that still need to be corrected, along with the estimated completion date agreed to by the contractor. The municipality is also notified to have their building inspector come and do their permit inspections.

In this case neither the architect nor the building inspector did their final inspections. Therefore the state of construction completion is unknown. As a property inspector I cannot put myself into a position where I am doing a "work-in-progress" construction inspection, as I have no knowledge of the state of construction. Neither can I estimate costs to complete as this is beyond an inspector's scope of work.

So here we have a contractor, architect, municipality and probably a bank and lawyers involved in the uncompleted project.

Finally, any new construction will have a new home warranty insurance policy taken out by the contractor, which will also have to be resolved.

Posted by

www.ekan.biz

EKAN Home & Property Inspections

Sunshine Coast, North Vancouver, West Vancouver 

Becca Rasmussen
HomeSmart Cherry Creek - Highlands Ranch, CO

Hi Eugene, welcome, and great post! That definitely sounds like a good situation to decline. 

It always interesting to me to see the differences in how things are done from locale to locale, state to state, and country to country. Here in Douglas County, Colorado, USA the Certificate of Occupancy is issued by the county building department and is preceded by an entire slew of inspections performed by the county's building inspectors. 

May 04, 2016 10:14 PM
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Eugene, sounds like you are a small inspector, and know when to walk away from a potential job! Great first post, and looking forward to more.  Welcome to ActiveRain!  

May 04, 2016 10:25 PM
Tony and Suzanne Marriott, Associate Brokers
Serving the Greater Phoenix and Scottsdale Metropolitan Area - Scottsdale, AZ
Haven Express @ Keller Williams Arizona Realty

Welcome to Active Rain Eugene Kanciar  - as REALTORS® who have been here for more almost 10 years, it's well worth it!

And congratulations on your first AR post being featured - looking forward to reading more from you!

May 04, 2016 10:52 PM
Dianne Goode
Raleigh Cary Realty - Raleigh, NC
Realtor/Broker

Here in NC the CO is issued by the city or county, whichever applies, after the home has passed its final inspection.  The house can't get power without a CO, which pretty much prevents occupancy before the CO is in hand. 

Welcome to Active Rain!  It's a great resource!

May 04, 2016 11:03 PM
Charles Buell
Charles Buell Inspections Inc. - Seattle, WA
Seattle Home Inspector

Hey Eugene, glad you signed up---keep up the blogging and let it do the work for you.   It does not look like you need to practice too much---become a rainmaker and make your blogging count.

May 04, 2016 11:03 PM
Shirley Coomer
Keller Williams Realty Sonoran Living - Phoenix, AZ
Realtor, Keller Williams Realty, Phoenix Az

Welcome to ActiveRain and congratulations on your post.  Hard to believe people were living in the house.  That situation sounds like nothing but risk!!

May 04, 2016 11:33 PM
Sam Shueh
(408) 425-1601 - San Jose, CA
mba, cdpe, reopro, pe

Unlike termite the property inspection can not provide estimates.  I often get asked about the repair or rehabilitation cost by the lenders.  The real update is not something lenders want to know.

Sam Shueh

May 05, 2016 12:00 AM
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Get Eugene Kanciar  involved...that's all I know

May 05, 2016 12:33 AM
Mery Fernandez Empire Network Realty Luxury Brokerage
Empire Network Realty INC. - Orlando, FL
The Rise of An Empire, Let's Build Yours!

Hi Eugene! Welcome to the world of Activerain, may your blogging  create a whole new chapter in your Real Estate Career.

May 05, 2016 01:23 AM
Mike Frazier
Carousel Realty of Dyer County - Dyersburg, TN
Northwest Tennessee Realtor

Here in tennessee we have lots of people who convert a carport into an extra room without a building permit or inspections. This is a no no.

May 05, 2016 02:57 AM
Mike Rock
Complete Design - Granite Bay, CA
Granite Bay Luxury New Construction...For Less

good post. and welcome. this is true (or some variation) in most if not all states i assume

May 05, 2016 05:09 AM
Eugene Kanciar
EKAN Home Inspection - West Vancouver, BC
Our Experience, Your Peace-of-Mind

Dear ActiveRain community, I'm blown away by the volume of comments and reviews. Thanks for being so enthusiastic with your feedback. What a great welcome for a newbie! 

May 05, 2016 10:27 AM
Mike McCann Nebraska Land Broker
Mike McCann - Broker, Mach1 Realty Farm & Commercial Land Broker-Auctioneer Serving Nebraska - Kearney, NE
Farm & Commercial Property For Sale 308-627-3700

Hi Eugene Kanciar 

Sounds like you did the right thing.  It is hard but vital to walk away from bad business that could hurt you way more than it will help you! 

Welcome to AR!!

May 05, 2016 12:07 PM
Anthony Vosilla
Tony's Appraisal Services - Centereach, NY

I didn't realize that Home Inspectors also have issues when dwellings lack a C O.  On the appraisal side  this also causes issues with the lenders whom want reports fast.  Without a C O the dwelling is not considered finished.  

May 05, 2016 12:45 PM
Juli Vosmik
Dominion Fine Properties - Scottsdale, AZ
Scottsdale/Cave Creek, AZ real estate 480-710-0739

Wow, complications, complications, complications.  Wouldn't they have been better served getting the municipal inspector involved to assure the quality of the work first?  Of course, if it didn't have the typical during build inspections, inside those walls could be tons of problems.  And, unless you have xray vision, it sounds like it was a wise decision to walk away.  

May 05, 2016 01:03 PM
Dorte Engel
RE/MAX Leading Edge - Bowie, MD
ABC - Annapolis, Bowie, Crofton & rest of Maryland

Dear Eugene,

Oh, oh! Sure good they talked to you before going to far down the purchase path.

May 05, 2016 01:06 PM
Kimo Jarrett
Cyber Properties - Huntington Beach, CA
Pro Lifestyle Solutions

Without a CO, there could be other issues too, like no permits or other issues.

May 05, 2016 05:13 PM
Theresa Akin
CORPUS CHRISTI REALTY GROUP - Corpus Christi, TX

Welcome to AR. great post!! Hate when the ducks aren't in a row and scattered all over the pond.

May 05, 2016 10:59 PM
Lyn Sims
Schaumburg, IL
Real Estate Broker Retired

Eeek & to think someone is living in a house with safety issues.

May 06, 2016 06:28 AM
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • GRI • HAFA • PSC Calabasas CA

Eugene,

Welcome to our blogging community! 

Congratulations on your first post. Thanks for sharing your experience.

May 06, 2016 04:57 PM