Tony Hwang wrote:

Patscga wrote:

That's not true at all. I sold a house last year with a basement that I
did off the books. I also know many people that have done the same thing
and had no problem. It is quite a common occurrence, legal or not.


You're right. And the property assessment department couldn't care less. And
the tax assessor couldn't care less, either. I speak from experience.
Pat
Hi
Insurance company may care if they know about it when fire broke out.
Tony

Depends where you are IMHO. Insurance companies can be a
different matter; especially when insurance industry profits are
down!
In this township the regulations about 'finishing' a basement are
pretty relaxed. Most people wouldn't even think about a permit
(if one is even required!) and the town doesn't seem to check.
Finishing out a basement area is generally seen as someone having
'improved' the property and added to its market/resale value.
Many homeowners here are excellent do it your selfers, are in the
construction industry themselves or have relatives/friends who
help them out.
But next time (maybe five/ten years later) a tax assessment is
done the 'improvement' may be picked up and the assessed value
increased; to the surprise and remorse of the owner! The 'new'
owner of a purchased property, having made no changes themselves
during those years, then demands to know why 'his' assessment has
increased!
There was a recent house fire (caused by an electrical
malfunction on or near the main panel, at night; the three
occupants were lucky to get out alive! Fortunately none were
sleeping in the basement which had only one exit although some of
the basement windows were at or above grade level, which would
have possibly been an escape if required. AFIK the homeowner got
everything fixed by his insurance company; after all they insured
the house for him just the way he bought it from the
original/previous owner!
But the owners son told me that the insurance company found that
the rapid spread of the fire and an amount of the damage was
aggravated by the manner in which the basement had been
'finished' by the previous owner. Specifically there was a lack
of fire blocking and there were large air spaces behind the wood
framed finished basement uprights walls, which had been added.
The original structure was comprised of partial concrete walls
with a wood framed 'knee wall' on top of the concrete, supporting
the main floor. As a result of the basement being 'finished'
there was, for example, a large open air space behind the added
interior 'basement' wall above the concrete wall that allowed the
fire, once started to spread quickly along one whole side of the
house.
So beware of a) Risky construction and b) What your insurance
might NOT cover; quite apart from c) Risk of death injury to your
family!
Terry.