Additional Units Not On The Books
I'm looking at a 4-unit property, but have just found out that it's listed with the town as 3-unit property. The fourth unit was built without a permit from the town and is therefore not included in the tax assessments, etc. Also, I'm not sure if a permit would have been granted had the seller tried to get it. Anyway, I've never come up against something like this, and would just like to understand what potential risks and hidden costs might be involved with purchasing a property like this? Any ideas?
[addsig]
The good, no taxes on it. The bad would be that if Code enforcement found out about it you could be forced to tear it down, and legal problems for renting it out illegally. Its a real "Roll the dice" type of situation. I would only pay for the three unless he gets it permitted or have him take a deep discount on it to outweigh the potential pitfalls.
Good Luck,
Kyle