Selling or buying a house with unpermitted work in California (and San Francisco)

Statewide, California Civil Code Section 1102 applies to the sale of single-family residential property, with a few exceptions. Under Civil Code Section 1102.6, the seller must fill out the Real Estate Transfer Disclosure Statement (TDS) and answer “Yes” or “No” to whether they are aware of specific conditions on the property, then explain every “Yes” answer in writing:

• Question II.C.4: “Room additions, structural modifications, or other alterations or repairs made without necessary permits” (Civil Code §1102.6).
• Question II.C.5: “Room additions, structural modifications, or other alterations or repairs not in compliance with building codes” (Civil Code §1102.6).
• Question II.C.10: “Any zoning violations, nonconforming uses, violations of ‘setback’ requirements” (Civil Code §1102.6).
• Question II.C.15: “Any notices of abatement or citations against the property” (Civil Code §1102.6).

Civil Code Section 1102.1(a) states that delivery of the TDS may not be waived in an “as is” sale. Under Civil Code Section 1102(c), any waiver of the disclosure requirements is void as against public policy. If a seller delivers the TDS or an amendment to it after the buyer signs an offer, Civil Code Section 1102.3 gives the buyer 3 days after personal delivery (or 5 days after delivery by mail or electronic delivery) to terminate the offer in writing.

This article explains what California statutes and San Francisco Building Code provisions say, not how they apply to your specific contract. Talk to a California real estate attorney or your real estate agent before making disclosure or contract decisions on a sale or purchase.

If your San Francisco home has an unpermitted bathroom, kitchen remodel, deck, or ground-floor rooms, you have three practical paths before going on the market:

If you decide to legalize unpermitted work before selling, or after buying, the San Francisco Department of Building Inspection treats the application as a permit to legalize existing construction:

• Permit application and penalty fee: You submit a building permit application (and electrical or plumbing permits if wiring or pipes were added) stating that the scope is to legalize work built without a permit (SF.gov guide to fixing a building code violation). The penalty is nine times the permit issuance fee plus the original permit fee (SF.gov NOV information). If the fees are for unpermitted work, you may be able to reduce them by filing an appeal with the Board of Appeals (SF.gov guide to fixing a building code violation). If a previous owner did the work and you can document that, the Building Official may cut the investigation fee to two times the permit fee (SFBC Section 107A.5).
• As-built drawings and stamps: Unless the work fits DBI’s short list of no-plans permits (SF.gov check if your permit needs plans), you need scaled plans showing the prior legal layout and the as-built layout. Under B&P Code §5537 and B&P Code §6737.1, an unlicensed building designer or licensed architect may draw conventional wood-frame work in a 1-to-4 unit building up to two stories plus a basement, while a licensed architect or engineer must sign and stamp any structural work that departs from conventional wood framing (B&P Code §5537(b)). See our guide on architect vs. building designer in California.
• Legalizing an unpermitted in-law unit: For unauthorized dwelling units built before Jan 1, 2013, SFBC Section 106A.3.1.3 provides a voluntary legalization screening process that requires floor plans and a written assessment from a licensed contractor, architect, or engineer.

If you are evaluating a San Francisco home before making an offer, cross-check four public records against the house in person:

1. Read the 3R Report line by line: The seller must give you this report. It shows the building’s authorized use and its building permit history, but not plumbing or electrical permits (SF.gov 3R Report page). If the house has three full bathrooms today, check whether the 3R Report shows permits for adding them.
2. Look up the address in DBI’s Permit and Complaint Tracking System: Use SF.gov’s building permit and complaint tracker to check every permit, electrical permit, plumbing permit, and complaint at the property address. Look at the status of each permit: an “Issued” or “Expired” permit without a “Completed” (final inspection) status means the work was never signed off by a DBI inspector.
3. Compare the TDS against the home inspection report: Match the seller’s answers on TDS Questions II.C.4 and II.C.5 (Civil Code §1102.6) against your physical inspection report. Pay close attention to ground-floor ceiling heights, newly tiled bathrooms with no permit history, fresh drywall over garage framing, and removed walls between living and dining rooms.
4. Check who designed any recent remodel: If the seller advertises a “permitted designer remodel,” pull the permit number on SF.gov’s permit tracker to see whether structural plans were stamped by a licensed architect or engineer or pulled as a surface-only OTC permit.

Under California Civil Code Section 1102.13, no transfer of title is invalidated solely because a person failed to comply with the statutory disclosure article. However, any person who willfully or negligently violates or fails to perform any duty prescribed by Civil Code Section 1102 et seq. is liable in the amount of actual damages suffered by a transferee (Civil Code §1102.13).