I recently started a deal in Montgomery County, and it was a breath of fresh air to cooperate with the county inspector. In just a couple of meetings, I solved several issues the county had been working on for years, and they helped me achieve a better product in a short time.
The story starts about a year ago. A friend referred to me an acquaintance who had just inherited a home. They wanted to sell the home and wondered whether a cash buyer would be the best option.
The home had a lot of problems. Someone had made a lot of modifications without the required permits. They had built two additional bathrooms in the home. Neither was permitted, and they had run pipes and water lines all over the place. On the second floor, they added a bathroom in a bedroom, putting a shower under the stairs and a jetted tub in the corner of the room. It was one of the strangest things I’d seen.
They also built a bathroom in the attic in a similar fashion. Not only did they not care about permits, but they also didn’t worry much about codes, either.
The septic tank also turned out to be a mess. The county had known it was in bad shape and not up to standards. Sometime in the 1980s, the owner had submitted a partial plan to repair and improve the system, but nothing was ever done. Some of the features listed on the county’s plans didn’t exist. It took my septic guy quite a bit of exploratory digging to uncover the tank and determine that we were missing a dry well that had been listed on the plans.
Years before, the county ran public water lines to the area, and this home hooked up. When a home connects to public water, the county wants the owner to cap the existing water well. This is done to prevent groundwater contamination and other issues. This well was never capped, even though the county had been trying to get the owner to do it for quite some time.
The county would not approve building permits until the well was capped. That may have been one of the reasons that no permits were obtained for the additional bathrooms.
I was unaware of much of the county’s issues when I first toured the home. Because the owner inherited the home, they, too, were likely unaware.
After evaluating the home, I was very straight with the seller: I told them that I could pay them $250,000 for the home on a quick close deal. But I showed them the comparable sales. I told them there are a lot of people looking for fixer-upper homes. This home may be a little too much for most buyers, but there are some adventurous types out there who might pay much more for the home than I could offer.
I advised them, as I advise everyone, that if they had the time and patience to deal with the retail market, they’d almost certainly make more money listing the home with a real estate agent. I told them that they could always come back to my offer.
They wanted to try to get more money and they had time, so they listed the home with an agent. But the issues were just too daunting and there were too many unknowns for the home buyers out there. After about six months, they had not had any luck and called me back to take my offer.
I purchased the home and went to work. We drew up plans and applied for permits, and the county’s red flags immediately started going up. At the time, I didn’t know the home was on the county’s radar. I knew the septic tank was old, and I assumed it would need major work and probably full replacement.
The county already knew the situation and told us we could not get any permits until we had a septic inspection and provide plans to update the system. I thought to myself, “Here we go again.”
This was a bit unusual. Normally, I would get the home-renovation permits started first, because that work takes longer, and simultaneously work on evaluating the septic.
The county wanted the septic system uncovered and inspected by its people before we did anything. So we set up a meeting, and I feared the dreaded red tape and inspector bluster. It seems like inspectors feel the need to come on strong and attempt to intimidate. Probably because many people, especially flippers, try to cut corners.
This meeting was different: It was extremely productive. Within an hour, we devised a plan to replace the entire system. My septic guy had the work done by the end of the week, and at the final inspection, we capped the well right in front of the inspector.
Within a couple of weeks, we had our renovation permits. The county was already aware that there was some sort of unapproved plumbing in the house and wanted it fixed. That was not a problem because that was part of my plan from the beginning.
Everyone benefited from the outcome of this project. It’s unfortunate that renovators and county building departments so often clash, because ultimately our end goals are significantly aligned. We should act much more like partners than antagonists. We could solve so many more problems on both sides. But it does take two to tango, and I realize many on my side are not good partners.
The counties and municipal building departments are cracking down on work that hasn’t been permitted, and it’s much easier now for buyers to check for proper permits. Flippers and renovators would do well by learning to dance rather than continuing to attempt to evade the system. And building departments should work on speeding up their part of the process. Many of us on this side plan to do the work the right way. It’s the delays and county hurdles that we dread.
The county shouldn’t be so nice to everyone, however. Cracking down on those bad actors would make the system better for all of us.
Justin Pierce is a real estate investor and real estate agent who regularly writes about his experiences buying, renovating and selling houses in the Washington area.