One of the most common questions I get from weekend warriors is, “Do I need to pull a permit for this rehab?” And let’s be honest, it’s a legit question because permits aren’t always required. There are also some grey areas where working without permits seems reasonable and can save you time and money. Localities differ as to what constitutes the need for a permit, but as a general rule of thumb, if you’re changing anything structural (including swapping out doors & windows), you’re required to pull a permit.
In the real world however, contractors don’t always take that extra step. Can you get away with? What are the consequences if you try? What’s the risk/reward ratio? Well, as with most situations in life, there are exceptions to the rule. As you’ll see, you should err on the side of caution — because it can cost more than it’s worth.
Can you get away with working without permits? Sure, you can. If your project is one of those magical unicorns we all love, just paint and carpet, there’s no need for a permit. And here in Albuquerque, if you’re just doing cleanup work and need a dumpster, no permit is needed (although you may attract inspectors so make sure cleanup is all you’re doing).
But what about swapping out water heaters? Repairing shingles on a roof? Replacing windows? These are all scenarios where a permit might not seem necessary but is typically required. In addition, those are also common scenarios where a permit could open up additional inspections you may want to avoid. As a result, contractors will often assess the risk and take a chance.
Working Without Permits Can Stop Your Project
Here in Albuquerque, New Mexico, the permit folks drive around to their scheduled inspections — but always with a lookout for a dumpster that seems out of place or a roof replacement underway. If they spot one that’s not on their list, they’ll walk up and ask for your permit. If you don’t have one, you’ll get a red tag and work must STOP!
Those situations are usually the result of obvious work being done outside that will catch an inspector’s eye. But what about electrical, plumbing, and HVAC work that’s going on inside? Sure, you can often get away without pulling those permits…until you get caught.
Really, though, getting permits is all about safety. You get a permit, then you do the work, then you get inspected to make sure you followed the Building Code, If you got the work done correctly, you get a green tag. Simple, right?
So why do people try to get by without permits? The biggest reasons are cost and time. You can save a few hundred dollars without a permit and sometimes it takes a week or more to get inspections. So for some jobs, contractors might not want to hold up progress waiting for an inspector to tell them they framed out a window correctly and can now install drywall.
But what is the cost of NOT getting a permit…if you get caught? Let’s look at a real-life example.
Never Assume Licensed Contractors Automatically Pull Permits
When I first started flipping houses, I didn’t do any of the work myself. Hell, I didn’t know the code and I didn’t want to. After all, I was a Project Manager, not a contractor. I figured that if I worked with licensed contractors, they’d do what was required. Now I have Project Managers and Licensed Superintendents who are knowledgeable and skilled at all the required work — so they can catch shoddy work early on and get it corrected before an inspector sees it.
In the old days though, this is how a conversation with a subcontractor might go:
Me: “You’re licensed, right?”
Plumber: “Absolutely! Here’s my license number.”
Me: “Great, you’ve got the job!”
Since I was working with a licensed pro, I assumed code requirements would be followed and necessary permits pulled. A reasonable assumption considering the law requires a plumbing permit for most gas plumbing work.
Home Inspections Can Catch Bad Work
However, when it came time for the home inspection, the water heater had not been installed correctly — it did not have a seismic strap secured, and the new gas furnace did not have the correct duct connections for safe venting of fumes. Home inspections don’t typically get done until the end of the job, so good luck getting your licensed pro to come back and fix things after you’ve paid them.
And that’s why some contractors don’t pull the permits — because they can get away with shortcuts and be paid long before you realize it. For a typical homeowner who just wants a water heater replaced, that may be a worthwhile risk because no home inspection is involved. But to sell a rehab, home inspections are par for the course.
Initially, I saved a TON of money with this plumber. But after the home inspection, I had to hire another for-real-licensed plumber to get a permit (costing an extra week) and fix the home inspection discrepancies (a full day’s work). But wait, there’s more!
When the City Inspector came for the green-tag inspection, she inspected everything else in the house as well, and found other things the first plumber did wrong. My total cost of that lesson learned was an additional $8,000 PLUS four weeks added to my schedule. Much of that expense and time would have been avoided had the first plumber pulled a $50 permit.
Permit prices vary depending on locality and work being performed, HomeAdvisor has a helpful tool to calculate your permit fees.
In this case, not only did I learn the dangers of working without permits and having an inspector catch bad work after the fact, but I also learned that people lie and just because they give you a ‘license number’ doesn’t mean they’re legit.
Now I have my assistant track down and verify licenses and upload copies into our construction app. They also upload copies of liability and workers comp insurance, as well as copies of all permits and inspection reports. We have a job board on each project and it includes permits, inspection tags and contact details of all licensed trades used on that job. If an inspector shows up and my superintendent isn’t on that jobsite, the job board answers most of their questions. In addition, subs do not get final payments until final inspections are complete. And the best part is, the real professionals already know this is the standard and never argue about it.
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