Violation of building codes question

[Rlong]

I'd like to start with, I'm working on becoming a trianee so I'm very new to this industry. My question from the procedures class is: If an appraiser see observe building code violations on a residential home what is her responsibility? 1.proceed and document in report
2.immediately withdraw from the assignment
3.report it

If neither please tell me the answer
Thanks in advance.

Some good comments. In addition before you declare something "illegal" you need to be quite familiar with your local code as well, and what might have been legal over the years, not just the current code. I sometimes hear appraisers, and others claiming something is "illegal" because it doesn't meet current code, even though it's a 1970's house, and there is no requirement for them to bring everything in there property up to current code. Many municipalities have changed their code book (from say UBC/BOCA to IBC) as well.

Bob in CO

 

[sputnam]

We are appraisers. We aren't code enforcement officers. A attorney once pointed out to me that when you sign an appraisal report, the descriptive portions are in effect an affadavit. Stick to your expertise.

 

[Restrain]

A 1910 home will not meet a current building code. So many things are grandfathered so that while it does not meet "code", as long as it is not a "health and safety" issue, the cities do not pursue it. Health and safety is the key. That is why you have the lead paint comment on homes built prior to 1978, the fact that tube and knob wiring is still acceptable while not meeting current code (perfectly safe if maintained).

You are not the code police (see the threads about being the permit police). Describe what you see, omitting code comments, and use comparable sales, adjusting as necessary.

 

[Mike Garrett RAA]

The answer, based on the question's three possible answers is..........1.

There could be other choices but those were not listed. We are not code compliance inspectors...we are appraisers.

Code compliance is not an appraisal requirement, in most cases. As previously stated, many residences do not meet current code requirements

Most of the time, our experience and training does not make us expert in code.

Most of the time, our appraised values will be based on "as-is" condition.

 

[Sid Holderly]

It depends, On many codes if it was built before the code it is grandfathered and does not need changed. On others it will likely have to meet current code (like water heater at least 18" above the floor of a garage). Many are local, so you have to know your local area and where they change county to county etc.

 

[residentialguy]

The answer, based on the question's three possible answers is..........1.

There could be other choices but those were not listed. We are not code compliance inspectors...we are appraisers.

Code compliance is not an appraisal requirement, in most cases. As previously stated, many residences do not meet current code requirements

Most of the time, our experience and training does not make us expert in code.

Most of the time, our appraised values will be based on "as-is" condition.

Is that like the 3 letter word "JOBS"?

 

[HoustonRE]

An example would be if someone covert their garage into a bedroom. And yes this is more of a general question but I guess it really does depend on the circumstances at hand.

 

[incognito]

JGrant: FHA is a federally backed loan... You state:

and if it is not up to code, likely the property would not meet MPR.

Is that so? Then over 50% of all homes in Florida are not eligible for FHA financing, because they were not built to current hurricane codes.

Everywhere I appraise in Brevard County is under the Miami Dade Hurricane code. That code requires (and has required since the early 199o's in some areas, and the early 2000's in others) that all new construction homes be constructed with either positive pressure construction, impact glass, or hurricane shutters, because it is code. So are you saying that if a house does not have shutters (or impact glass or positive pressure design), regardless of when it was built, that I must stip it to have shutters as an MPR? I hope not...



ResGuy: In the recent FHA webinar, the 2 FHA officials SPECIFICALLY state that permits are not required by FHA for additions, conversions, etc. I posted about the webinar in the FHA section on the forum, "50 most common appraisal mistakes". I do not have it in writing, but you will find it in that webinar. I was somewhat surprised to hear that, but think it is a wise decision. They continue to say that we should let the market dictate the acceptability and contributory value of unpermitted items.

Regarding code requirements, FHA says:

3-5 CODE ENFORCEMENT FOR EXISTING PROPERTIES
Local municipalities design local housing code standards;
therefore, enforcement of such housing standards rests with the
local authority. HUD does not have the authority or the
responsibility for enforcing local housing codes except for
mortgages on properties to be insured under Section 221(d)(2)-a
program with mortgage limits at $36,000.

Pretty strong support for my assertions, but I would like to see what you have too!

 

[HF Mudd]

The only real answer is: 4. It depends.

I agree with CAN and others who said it depends on the situation.

I can think of multiple scenarios where a violation of building codes does not result in any market reaction; I can also think of multiple scenarios where a violation of building codes can result in a "subject to" appraisal, or a discussion with the client as to the appropriate scope of work.

The best way to learn what to do in each situation is to (a) find a good mentor and (b) be a frequent visitor to this forum.

Good luck in your chosen career.

 

[Mike Kennedy]

Wrong. FHA specifically DOES NOT require code compliance, and specifically DOES NOT require building permits...

http://appraisersforum.com/showpost.php?p=2219179&postcount=3