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It’s Always Best To Know Your City’s Codes That Pertain To Your New Investment Property

It’s Always Best To Know Your City’s Codes That Pertain To Your New Investment Property

By Craig A Williams

Over the years I have noticed a new trend in building code violations that pertain to properties that have been vacant for more than one year. I have bought properties in two different municipalities and in both cases I was not aware of the new codes that were put in place by the municipalities. In both cases the fact that the properties were vacant for one year was the trigger for the code to go into effect. Both properties were foreclosures one was bought on the sheriff sale and the other was a bank repossession that was listed by the bank. Both properties were vacant for at least a year before I bought them.

The first property that I bought was a absolute horror story that I was completely unaware of, in fact I would never had dreamed that this situation could ever happen. Here is what happened. It was about 9 years ago and I bid on a property that was on the sheriff sale at the courthouse. I had the highest bid of $27,500. I had to put down a cash deposit of $1,750 to secure the sale the rest of the money would be due in two weeks. Luckily for me I drove by the property and saw that the door was open so I went in and made sure that everything was alright. At that time a building inspector stopped by and told me that the property was scheduled to be torn down in the next month. I told him that I just bough the property on the sheriff sale and I was going to fix up the property and sell it. He informed me that since the property was vacant for a year the lot size was not wide enough to be a buildable lot and the code for the lot size would apply to this property because of the vacancy. Basically they applied the code like there was no house on the lot at all. Within the month the property was torn down and to this day there is nothing on the lot. I got a lawyer, but I was never able to get my deposit back. At least I never paid the full price for the property who knows what would have happened. I don’t know if I could have stopped the demolition or not.

The next property is one that I just bought. Because the property was vacant for over a year I had to have a special electrical inspection done that number one cost me $75 and worse yet cost me a week of work before the electric could get turned on. Everything was OK with the electric. By the time reports were faxed to the appropriate agencies it was a week until I was able to get into the property and actually get some work done.

I am writing this to stress the importance of being up to date on the building codes in the municipalities that you are looking in. In both situations these codes that were applied were just passed and I had not heard of them yet. How could I have protected myself from these situations? I found that when a property is vacant for a year the city has extra powers that they would not normally have if the property would have been occupied. It is a good idea to ask other investors you know and a call to the city may not be a bad idea to see if there are anythings that may affect your particular situation. A simple call to the city in the case of the first property would have convinced me to never bid on the property in the first place. It just goes to show that there is no substitute for being prepared by making sure that you are aware of all details and pitfalls.

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