Trying to sell a house with code violations can leave you feeling frustrated, angry, and maybe even a little confused. Unfortunately, there are quite a few things that can register as a code violation, and stop buyers from being able to close on your house when the property does not meet housing regulations. Read on to find out more about code violations and how you can still sell your property with them.
What is a code violation?
A code violation, in short, is an infraction of a property that has not met the rules, principles, or laws of the building code adopted by a town/city, or county. Houses start out code compliant with the regulations generally there to ensure the health, safety, and welfare of the general public. Having code violations may sound scary and there are stories about how they can sometimes slow or even halt the sale of your property. However, it doesn’t mean the property is unsafe, condemned, or even uninhabitable.
When selling your property in most states, even in Illinois, it is illegal to not inform the seller of these infractions. Examples of these can be something as small as grass length with tickets from the municipality or missing GFCI outlets all the way to having an uninhabitable area in use like when someone converts a garage to living space and has done so without a permit.
Building code violations can be more common than you think though. In fact, according to the Common Code Noncompliance Survey Report by the National Association of Home Builders (NAHB), there is an increasing trend of code violations such as those related to fire hazards (53%), structural concerns (50%), and accessibility issues (38%). Furthermore, NAHB also found that as much as 60% of new construction is not found to be code compliant.
Unfortunately, homeowners sometimes unknowingly commit code violations to their homes when they perform renovations themselves without the proper permits, not doing them correctly, or using unsuitable materials.
Can You Sell A Property With Code Violations?
The short answer is yes, you can sell a home with code violations. Before you can sell the property, you will likely need to fix them or the buyer will likely need to accept and confirm they will fix them to allow for occupancy. As we said though, you will need to disclose any violations to your buyer that need repairs and just like in life, honesty is the best policy. Also, remember that the company providing the mortgage for your buyer will also want to ensure the home is in compliance and may not lend to the buyer unless you make the needed repairs before closing the sale.
As with most cases, you should talk to your agent or a professional about the condition of your home before you decide what to do about the code violations. Let’s look at examples of code violations that need repair and what all your options are.
Is There A Code Violation List I Should Be Aware Of?
There are a few common code violations that occur. Unfortunately, there isn’t a list or set of rules every city uses. Here are 9 common code violations to be aware of and the reasons they are considered to be a risk to health or safety.
Outdated smoke or carbon monoxide detectors – Detectors have a life expectancy and any old detectors should have scheduled replacement. Sometimes a replacement is not caught.
Misplaced or missing smoke or carbon monoxide detectors – Carbon monoxide detectors and smoke alarms should be within a safe distance from sleeping areas. This is to ensure everyone can hear the alarm going off while sleeping.
Missing or incorrect outlets – GFCI outlets must be used within 6 feet of any water source to prevent electrocution accidents.
Missing or improperly placed handrails – Handrails have to have a certain height and should always be included with stairs. Some mortgage types require them too.
Handrails without returns – To avoid snagging sleeves and straps, handrails must end by turning into a wall.
Improper flashing of windows and doors – Having improper flashing and framing can lead to increased water damage and moisture ingress.
Exhaust fans venting improperly – Exhaust fans that vent into the attic space and into the insulation can cause moisture problems and lead to health hazards and should be properly vented outside of the house.
Messy electrical panels – Electrical panels with missized circuit breakers or an overloaded panel may require an electrician to look at them and fix them for you.
Unpermitted or unauthorized renovations – It’s best to make sure all renovations are permitted and finished to code. If they aren’t, these can cause quite a big cost to get up to code and permitted.
As you can see, there are various code violations ranging from minor to very major. It can be from having a vacant house, a home going through probate, or even a hoarder house. Any reason you need to sell, having code violations can make selling your property more difficult. Read on to see what your options are.
Does A Code Enforcement Violation Stop Me From Selling?
The first thing you’re probably asking yourself is why do I have to bring these code issues up to date or can you just sell it without updating code issues?
The short answer to that is it depends. Most homes started in compliance of the local building codes and due to changes in building code or wear on the property, they have fallen out of compliance. Some of the first things to do is to assess the cost of the repair, like placing covers on light fixtures in closets are a common code issue normally pointed out in a home inspection. To replace one of those is probably less than $20 and should be an easy fix. What about the hard stuff?
Remember, this will all be based on your local jurisdiction and the laws that govern them. You may not have to fix them though. Acknowledging the buyer will have to fix them will likely lead to a discount on the property and a lower selling cost. After listing it on the market and paying the fees and commissions, you may end up walking away with less than you hoped. There are a few to discuss and acknowledge you might have to do something about. They are:
- Electrical Panels. Many homes (especially older ones) have outdated or improperly sized electrical systems. Not only are they inefficient, but they can also be dangerous for any inhabitants. As a result, some mortgage providers require that the seller upgrades their electrical systems to be code-compliant before the purchaser may close on the property.
- Plumbing Issues. Old or faulty plumbing can lead to a wide variety of problems for a homeowner. Water damage from a burst pipe or drain issue, even an external problem, can render a home unlivable if it gets too severe. The seller will likely need to conduct a home inspection to ensure all plumbing systems are working correctly.
- Pests. A home infested with pests, ranging from termites to rats, would naturally be extremely difficult to list for sale. Since they can cause safety and health problems, pests are a serious code violation. The seller will need to clear the pests from the property if they ever want to list it on the market.
After fixing your code violations, you have 3 options when your property still has code violations. Read on to find out what they are. And if you don’t want to fix any of those issues, fill out this short form below here.
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What Are My Options When I Have Code Enforcement Violations?
Fix the Problem Yourself
To be honest, fixing the problem yourself is typically the easiest and most forward-thinking route to go. While you’ll need to spend the money, it will be much easier to list and sell your house once it’s up to code.
As you have seen, some code violations are easy and cheap to fix. Mowing your lawn, placing properly aged smoke and carbon monoxide detectors, or placing a cover on your closet light fixtures are easy to do yourself and very inexpensive. If you have an electrical or plumbing issue, those can be a bit more expensive to fix. However, you won’t need to lower your asking price just to sell your house (see below).
Lower Your Asking Price
Sometimes sellers don’t want to fix the code violations on their own, and the buyer will have to address them in order to obtain occupancy. If the issues are minor, it may not be challenging for the seller to convince the future buyer to address them themselves and cover the costs on their own. However, any extremely delayed maintenance may encourage them to walk away from the deal if it becomes overwhelming or too costly.
Knowing what the issues are and the costs to fix them would give you insight into one way you can convince them of the sale. That is to lower your asking price. Setting a lower price will give them the additional cash they need to fix any code violations. That said, you may still receive a lot of criticism from potential buyers and ask to renegotiate.
What’s more, the buyer may have difficulty securing a mortgage if the house has code violations. This option is usually only a good idea if the repairs don’t require much money and are easy to fix.
Find a Cash Buyer
If you want to sell the property as-is, the best way is to find a cash buyer. They won’t need a mortgage and understand the condition of the property, so they can move into the property right away and handle all the needed repairs.
With the assistance of a real estate agent, you can list your home on the open market. Real estate agents will understand the condition of the home and the need to find a cash buyer vs a fianced buyer. However, finding a reliable cash buyer can be tricky. Many don’t have the financial position to purchase a home outright.
Tips For Selling Your House With A Code Violation
Be honest about the condition and violations of your home to any potential buyers. Disclose all known flaws and code violations to any potential buyers. It’s not necessary to fix every little violation. Knowing what violations there are and the cost to get up to code would show a buyer you care about the property and acknowledge that you’re willing to meet them halfway in closing on the house.
You can start by doing little things like mowing the lawn, eliminating clutter and garbage, touching up peeling paint and installing properly aged smoke and carbon monoxide detectors. Ideally, your house should still look presentable. Most buyers won’t want to tour a dirty and unkempt house. If you’re unable to allow buyers to tour your house, finding a cash buyer may be your best bet.
As you can see, even with housing code violations, you have options. If you don’t want to do the work yourself, you can contact the owners of SILT Real Estate and Investments, LLC to help you sell your house with code violations. We’ll buy your house as is and you can walk away without having to fix any code violations.
Just fill out the form below and we’ll get your offer started on your house with code violations so you can sell it as is. And if you have any questions, don’t hesitate to reach out and give us a all at (708) 415-3801.
