Chicago Basement Units

[AlwaysLearning]

I believe that is incorrect information, based on my experience in the city, it is the RENTING which makes it an issue.

"it is the renting which makes it an issue"

Really?

Sooo…, an owner gets caught renting such an illegal unit, pays the appropriate fine, solemnly promises not to ever, ever rent this “in-law” unit again and this way the unit becomes legal, the city drops the issue and the owner enjoys the property happily ever after. [FONT=&quot]
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[DTB]

"it is the renting which makes it an issue"

Really?

Sooo…, an owner gets caught renting such an illegal unit, pays the appropriate fine, solemnly promises not to ever, ever rent this “in-law” unit again and this way the unit becomes legal, the city drops the issue and the owner enjoys the property happily ever after. [FONT=&quot][/FONT]

So, you think that if the "unit" is busted, fined and deconverted to finished basement status, that I think the "unit" becomes legal? :Eyecrazy:

The "unit" rarely becomes legal unless an alderman can get deemed so. The property with the finished basement has come into compliance, that's it.

 

[AlwaysLearning]

The basement apartment, if rented, represents an illegal use and no income from tha unit is considered.

The connotation of the above statement (which you apparently would include in your appraisal report) is that the basement apartment, if not rented, represents legal use.

And now you are saying that (my bold)

So, you think that if the "unit" is busted, fined and deconverted to finished basement status, that I think the "unit" becomes legal? :Eyecrazy:

The "unit" rarely becomes legal unless an alderman can get deemed so. The property with the finished basement has come into compliance, that's it.

:new_all_coholic:

 

[DTB]

The connotation of the above statement (which you apparently would include in your appraisal report) is that the basement apartment, if not rented, represents legal use.

And now you are saying that (my bold)



:new_all_coholic:

Yup, if it's not rented it is a finished basement with whatever finishes it has and OMG even a 2nd kitchen.

How does that constitute a "unit"?

If not rented it is a basement, finished or otherwise. Did I miss where basements now became illegal? When it is represented as an apartment, rented as an apartment is where the illegality begins, not before.

I never called the finished basement an apartment. I report that the basement is finished and describe and include pictures as well. What the owner does with that space is not my issue, it is illegal to rent it and gets no income attributed. Guy wants to rent his garage out to an alley mechanic? Same difference to me, it is what it is.

 

[William K]

Yup, if it's not rented it is a finished basement with whatever finishes it has and OMG even a 2nd kitchen.

How does that constitute a "unit"?

If not rented it is a basement, finished or otherwise. Did I miss where basements now became illegal? When it is represented as an apartment, rented as an apartment is where the illegality begins, not before.

I never called the finished basement an apartment. I report that the basement is finished and describe and include pictures as well. What the owner does with that space is not my issue, it is illegal to rent it and gets no income attributed. Guy wants to rent his garage out to an alley mechanic? Same difference to me, it is what it is.

Per the city of Chicago municipal code "17-17-0248 Dwelling Unit. One or more rooms arranged, designed or used as independent living quarters for a single household. Buildings with more than one kitchen or more than one set of cooking facilities are deemed to contain multiple dwelling units unless the additional cooking facilities are clearly accessory and not intended to serve additional households."


I don't see where the city states Rented Units in the above code??

This is one thing I know as fact. Had an appraiser working for me who owned a Queen Anne Bungalow with a second floor which was a legal Unit. Someone called zoning (garbage men) because of drywall in garbage. Inspector came out... second floor unit was fine as was the 1st floor, however they had a true "summer kitchen" in the basement, with an open family area and a small bath with shower. City Inspector flagged it for Illegal dwelling unit (only 2 dwelling units allowed per zoning). They had to go to court and were forced to remove the kitchen. The hefty Fine was waived once the kitchen was removed.

 

[DTB]

Per the city of Chicago municipal code "17-17-0248 Dwelling Unit. One or more rooms arranged, designed or used as independent living quarters for a single household. Buildings with more than one kitchen or more than one set of cooking facilities are deemed to contain multiple dwelling units unless the additional cooking facilities are clearly accessory and not intended to serve additional households."


I don't see where the city states Rented Units in the above code??

This is one thing I know as fact. Had an appraiser working for me who owned a Queen Anne Bungalow with a second floor which was a legal Unit. Someone called zoning (garbage men) because of drywall in garbage. Inspector came out... second floor unit was fine as was the 1st floor, however they had a true "summer kitchen" in the basement, with an open family area and a small bath with shower. City Inspector flagged it for Illegal dwelling unit (only 2 dwelling units allowed per zoning). They had to go to court and were forced to remove the kitchen. The hefty Fine was waived once the kitchen was removed.

Are rented units not intended to "serve additional households"?

Are non-rented units not intended to serve the current household?

So, your buddy's basement was stipped to remove the kitchen, rightly or wrongly-depends how your buddy handled the situation.

I still do not see the great hand wringing over this issue. You and A. L. seem so concerned, your choice-which I don't agree with but also don't have a proble with it- why not just call every 2nd or additional kitchen over the zoning allowance as illegal andtreat it accordingly?

I'd be very careful with that stance, I have several properties with the additional kitchen in the lower level with the City's blessing, some have even been given a Zoning Cert indicating the 3rd unit as legal.

I would hate for some appraiser to call out my kitchens as illegal when they are not.

The OP asked how people handle these situations, Lee and I have offered our method, you don't seem to like it.

 

[DTB]

As I stated prior.....Its an enforcement issue, they don't enforce without a complaint. ( sounds a little like a profession I know).

Of course as long as they don't get caught (a complaint) everyone is fine with it.

Properties such as this tend to fall (value wise) between the legal 3 unit and the legal 2 unit with just a finished basement. The fact the basement is not a legal unit doesn't seem to bother most buyers. They will use it as a rental anyway and just hope the city keeps ignoring them. It becomes the appraiser's problem when the city no longer ignores them or they lose the property to foreclosure. Then everyone is looking for a reason why and the appraisal report marked as anything but "Illegal" becomes the reason for the loss.

Lender- "We never would of done the loan if we knew it was Illegal"
Borrower / Buyer- "I never would of bought the property if I would of known it was Illegal"

Appraiser- The report clearly indicates that the lower level is a finished basement and may not legally be rented. It is additional living space not an additional apartment.

Appraiser- The borrower/buyerknows it is not a legit apartment based on the Zoning Certificate the seller is required to furnish which indicates how many units the subject has.

No confusion that I can see.

 

[William K]

What part of ILLEGAL are you not understanding?

If you have a zoning cert which indicates it's legal then it's Legal.

If you have a zoning cert that says its Legal as a 2 unit and you have 3 units then its Not.

The Illegal aspect of the property is what makes the whole Illegal. Correct the Illegal part and then the property is Legal.

Mis-representing what is there by using words to describe a "finished basement" as opposed to what the city rules state is a Dwelling Unit is deceptive.

 

[William K]

Appraiser- The report clearly indicates that the lower level is a finished basement and may not legally be rented. It is additional living space not an additional apartment.- As the appraiser we don't get to write zoning rules / ordinances as to what is a unit and what is additional finished space.
Its no difference then saying you know zoning is for a Single family but as long as I say I am not giving credit as apartments to the 2 other units then its not a 3 unit its just finished area.

Appraiser- The borrower/buyerknows it is not a legit apartment based on the Zoning Certificate the seller is required to furnish which indicates how many units the subject has.

No confusion that I can see.

It doesn't matter if it is rented or not as to zoning. There are hundreds to thousands of vacant 2-4 unit buildings all over the city, the fact they aren't rented doesn't mean they aren't 2-4 unit buildings.

 

[William K]

Are rented units not intended to "serve additional households"?

Are non-rented units not intended to serve the current household?

The POINT is the city makes no mention of if its Rented or not Rented as to if it is a Dwelling Unit in there eyes.

So, your buddy's basement was stipped to remove the kitchen, rightly or wrongly-depends how your buddy handled the situation.

I still do not see the great hand wringing over this issue. You and A. L. seem so concerned, your choice-which I don't agree with but also don't have a proble with it- why not just call every 2nd or additional kitchen over the zoning allowance as illegal and treat it accordingly?

I'd be very careful with that stance, I have several properties with the additional kitchen in the lower level with the City's blessing, some have even been given a Zoning Cert indicating the 3rd unit as legal.- If the city has determined it to be Legal then it is Legal, it's not what I posted originally but thats OK

I would hate for some appraiser to call out my kitchens as illegal when they are not.

The OP asked how people handle these situations, Lee and I have offered our method, you don't seem to like it.

I'm just trying to wrap my head around how a property unit being or not being rented matters to Zoning? and How it is not deceptive to say I'm calling it something it is not ( just a finished basement) because if I call it what it actually is, a Dwelling unit, then its Illegal.