Do Unpermitted Additions Count in Heated Square Footage — Sometimes and Sometimes Not

I was recently asked by a client if an unpermitted addition can count in your heated square footage.  I thought this was an excellent question so I sought out the answer from a local, trusted appraiser, Shannon Julian. 

In my State, North Carolina, the Real Estate Commission’s position is that, “unless the upgrade is”legal,” any additional square footage as a result of an illegal addition can not be listed in the MLS as heated square footage.

In contrast, the North Carolina Appraisal Board takes the position that, “if the additional square footage still results in zoning compliance, the square footage can be used in an appraisal.  If an appraiser finds an unpermitted addition, they are suppose to include that fact in the body of the appraisal.

You might ask how an appraiser or Realtor would figure out if there is an addition.  This can be found in a discrepancy between the tax records and the actual measurement of the house or the homeowner may directly tell you.

This is a very important point for all Realtors to consider when we are listing properties.  We should always be asking if there are any additions to the property and if there are, we need to ask the next question, was the addition permitted.

A few years ago I strongly recommended to a seller that he finish his unfinished bonus room in order to sell the house.  He was able to get this done at an incredible price to make it worth the trouble.  When I went to list the property, I asked about the permit and low and behold, he did not have one.  I asked him to contact the town and have the room permitted.  It was a very easy and painless process — even after the fact.