The House That Couldn't Be Sold

By
Real Estate Broker/Owner with Global Property Systems Real Estate DOS NYS #10491202606

I'll be taking a listing in a couple of weeks on a home that's been on the Hudson Valley, NY real estate market for three years. I'm pretty confident it will sell. Why this hubris on my part? Because I saw why it wasn't selling.

The home has been lived in by the same family for thirty years. It started as a small, two bedroom split level, but being handy, the owner made significant improvements himself for his growing family, hoping to create some sweat equity at the same time. He built an addition which added a bedroom. Then he transformed the basement into a fourth bedroom. A swimming pool was put in not long ago, and the porch was enlarged. So why wasn't this home, with all its improvements, sold by three different Hudson Valley real estate agents?

Because the home is illegal.

When I first viewed the property I started noticing little things that didn't add up. The basement had no windows, just concrete block walls sheathed in drywall. With no egress, or means of escape in the event of a fire or gas leak, it would never pass a building inspection as a bedroom. This basement was a death trap waiting for disaster. Strike one.

I noticed a bathroom the owner had added. It was adequate, but it didn't look like a professional job. I wondered that, if the basement had never been seen by a building inspector, had this bathroom had a plumbing inspection? I doubted it. Strike two.

Outside, the porch had floor to ceiling screens, but no railing. Easy enough for a child to push through the screen and fall to the ground several feet down. Definitely not up to code.

The pool had been professionally installed, but the owner built the surrounding patio. I noticed it wasn't properly fenced. It didn't have a latching gate, a New York state building regulations requirement for swimming pools. A child or impaired adult could have easily fallen in and drowned. Strike three.

When I asked the owner if the property had a certificate of occupancy by the building department, he had no idea what I was talking about. I explained that any significant improvement to a property must be inspected and approved by the town building inspector. The certificate of occupancy is his confirmation that the improvements were done according to the local and state building codes.

The owner explained that years ago when they built the addition, a local building inspector looked it over but never issued a certificate. Whether this was sloppy work on the part of the inspector, or a made up excuse on the part of the home owner, I don't know. But the fact is, even if this house had gotten a buyer, it never would have sold without a certificate of occupancy. No bank would ever approve a mortgage without one. Even a cash offer would die at closing, because a certificate is required by New York state law in any real estate transaction where a building is involved. This was truly a house that couldn't be sold.

I was pretty sure that these so-called "improvements" were a big part of why the home hadn't had an offer in three years. The basement bedroom alone would put off most buyers in a heartbeat. The plan now it to get the property ready for a visit by the building inspector. The homeowners are already digging access for a basement window (yes, they're doing it themselves.) They have someone coming to look at the toilet, and are making plans to fix the porch and patio fencing. If all goes well, we should have the repairs done in a few weeks, and hopefully a certificate of occupancy in hand. Then it goes to market.

Building codes exist for good reason, and though they may be demanding, and building inspectors overly picky sometimes, they really need to be adhered to. Don't let your home grow without following the rules.

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Rainmaker
1,431,497
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

Sounds like New York is pretty strict.  We sell stuff here all the time on an "As Is" basis when it comes to some improvements.  Of course is does bring the price down somewhat.

Sep 02, 2014 04:05 AM #62
Rainer
288,479
Thomas McCombs
Century 21 HomeStar - Akron, OH

Sometimes sellers do not want to hear what you are telling them, and so it takes a while for good advice to be recognized and action taken.

Good job on finally getting through to them.

Sep 02, 2014 04:09 AM #63
Rainer
147,473
Theresa Akin
CORPUS CHRISTI REALTY GROUP - Corpus Christi, TX

Great post. Isn't part of our job educating sellers on bringing properties up to code before market. I still believe if sellers are DIYers, they need to know about code before market. Another reason I suggest pre market inspections.

Sep 02, 2014 05:40 AM #64
Rainmaker
384,159
M.C. Dwyer
Century 21 Showcase REALTORs - Felton, CA
MC Dwyer-Santa Cruz Mountains Property Specialist

Vanessa, this story clearly illustrates why all agents are not equal.    In California we don't have the same certification process, and in my rural area many unpermitted "improvements" are made.    It's fascinating to me that so many sellers expect these "improvements" are worth top dollar!    Fact is, if it doesn't show up on the tax records, the best case is that appraisers don't count the "bonus" square footage.     Sometimes there is negative value.

Sep 02, 2014 06:01 AM #65
Rainmaker
179,080
Janelle Ancillotti
Seneca Home Staging - Syracuse, NY
HSR Certified Home Stager, Syracuse, NY

Why is it that so many agents fail to tell sellers what they need to know? Is it because they don't want to risk insulting the client? Are there that many agents who are so busy and don't really need the sale so they keep quiet in hopes that the right buyer will happen to come along? Is it so hard to say to someone, "Your house will sell faster and for more money if you address the pet odor/cigarette smoke odor/extensive collections/clutter, etc. etc.."??? If an agent can't bring him or herself to tell the client the hard truth, a professional home stager can help.

Sep 02, 2014 06:11 AM #66
Rainmaker
1,063,437
Sharon Parisi
United Real Estate Dallas - Dallas, TX
Dallas Homes

Vanessa, it sounds like the Sellers are lucky to have you.  May this home sell quickly!

Sep 02, 2014 08:13 AM #67
Rainer
220,151
Suzanne Otto
Six Twenty Designs - Lansdale, PA
Your Montgomery County PA home stager

Vanessa, good investigating on your part! Hopefully they'll get everything they need in order to pass inspections and you'll get that house sold!

Sep 02, 2014 11:59 PM #68
Rainer
12,391
Holly Biltz
Charles Rutenberg Realty - Saint Cloud, FL
I sell the dream of Home Ownership!

Great post very informativethanks for sharing!!

Sep 03, 2014 05:44 AM #69
Rainmaker
748,259
Pete Xavier
Investments to Luxury - Pacific Palisades, CA
Outstanding Agent Referrals-Nationwide

Vanessa,,

Good job with dealing with this upfront, wondering what the heck the agents before you where thinking!

Sep 03, 2014 10:55 AM #70
Rainmaker
20,667
Mary Stewart
Keller Williams Atlantic Partners/Southside - Jacksonville, FL

What a challenge, please let us know how it turns out.  You sometimes run across one infraction, but this house is a bundle of them.

Sep 03, 2014 10:56 AM #71
Rainer
9,905
Jessie Perozo
YRENTNY LLC - Bronx, NY
Yrent When You Can Own...

Great insight, Vanessa.  You knew there was a problem, you went in and assesed the situation, and gave your clients the solution to their problem. In my view, that's exactly what sellers hire agents for: Finding the solution to their home-selling dilemmas. As a new agent, I have noticed, a few list and go situations. It's not about listing the home, you have to sell it!

Sep 04, 2014 12:11 AM #72
Rainer
92,163
Donald Kolenda
KW KAUAI - Lihue, HI
Hawaii Sunshine

Like the way you present the facts. It is what it is, call it like you see it.

Sep 04, 2014 06:48 PM #73
Rainer
11,115
Shilpa shree
QSG Technologies Pvt Ltd
QA Test Lead

Sellers are lucky to have you, but what about buyers :P

Shilpa

Villas in OMR

Sep 07, 2014 08:49 PM #74
Rainmaker
257,245
Vanessa Saunders
Global Property Systems Real Estate - White Plains, NY
From Manhattan to the Catskills of New York

Buyers would surely be happier not to waste time viewing a property which can't be sold. Better that we rectify all the issues which would prevent a sale before going to market, than to waste anyone's time!

Sep 08, 2014 03:36 AM #75
Rainmaker
278,502
DALIA KIBBY
Sellstate Partners Realty - Cooper City, FL
Selling Broward County Homes with Passion!

Best of luck...sounds like you've done some 'heavy lifting' on this listing already!

Sep 08, 2014 03:50 AM #76
Rainmaker
1,384,126
Jeff Jensen
The Federal Savings Bank/Lending in 50 states - Greenwich, CT

Those are always tough situations to deal with for Realtors.

Sep 08, 2014 08:20 AM #77
Rainer
36,712
Glenn W. Small
Bayshore Group - Traverse City, MI
Full Time Realtor w/ 21 years of experience

What a great article, I really enjoyed it.  Thanks for the helpful information!

Sep 09, 2014 01:00 PM #78
Rainmaker
1,676,031
Winston Heverly
Winston Realty, Inc. - Atlantis, FL
GRI, ABR, SFR, CDPE, CIAS, PA

I really enjoyed coming across your blog among the many archieves. Thanks for being apart of Active Rain.

Apr 08, 2015 01:53 PM #79
Rainmaker
257,245
Vanessa Saunders
Global Property Systems Real Estate - White Plains, NY
From Manhattan to the Catskills of New York

WOW! where did this pop up again from! Thanks Winston. 

Apr 09, 2015 10:21 PM #80
Rainmaker
257,245
Vanessa Saunders
Global Property Systems Real Estate - White Plains, NY
From Manhattan to the Catskills of New York

Great News! This property is now fully legal and now has egress from the basement, giving it a further bedroom. All the other "Illegal" items have been corrected and shiny new CO's in place. Once that was done it was a slam dunk!

We are Under Contract! 

The Seller's were absolutely amazed that non of their previous Listing Agents had pointed out the very obvious... They could have sold long before if only due dilligence had been done. 

 

Apr 09, 2015 10:29 PM #81
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Vanessa Saunders

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