Why Homeowners and House Flippers Should Always Get Building Permits: An Expert Breakdown
When you’re excited to improve a home—whether it’s your personal residence or your next flip—it’s easy to focus on the fun parts: design choices, new finishes, fresh layouts, and increased value. But behind every successful renovation is one of the most overlooked yet critical steps in the process: obtaining proper building permits.
As a home inspector, I’ve seen firsthand what happens when homeowners skip this step. From safety hazards to failed sales, unpermitted work can turn a dream renovation into a costly problem overnight. Whether you’re a homeowner planning a project or a real estate investor trying to maximize profits, here’s why pulling permits isn’t just a recommendation—it’s a smart business and safety decision.
1. Building Permits Protect You and the Structure
The primary purpose of a building permit is safety. Permits ensure that all work—electrical, plumbing, structural, HVAC, roofing, and more—is completed according to current building codes. Codes exist to protect the people who live in the home.
Without a permit:
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A load-bearing wall can be removed incorrectly.
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Improper wiring can lead to electrical fires.
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Plumbing issues can cause hidden leaks and mold growth.
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HVAC mistakes can result in carbon monoxide hazards.
Even if a contractor claims they know what they’re doing, the permit process adds a layer of accountability. An inspector from the local building department must review the work for compliance, giving you peace of mind.
2. Unpermitted Work Can Be VERY Expensive to Fix Later
Many homeowners and flippers skip permits thinking they’ll save money. That almost always backfires. When unpermitted work is discovered, the local building department can require you to:
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Open up finished walls
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Provide engineering reports
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Completely redo work that doesn’t meet code
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Pay fines or penalties
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Pull retroactive permits at a higher cost
In many cases, you end up paying twice: once for the original work, and again to fix or verify it later.
I’ve inspected homes where beautifully finished basements had to be partially demolished because the electrical work wasn’t permitted. The homeowner ended up spending thousands more than if they had just pulled the permit in the first place.
3. Permits Protect Your Home’s Value (and Ability to Sell)
When it’s time to sell—even years later—unpermitted work becomes a major red flag. Buyers, realtors, lenders, and home inspectors all look for permit history.
Here's what commonly happens during a sale:
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An appraiser flags unpermitted square footage.
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A buyer’s inspector notes work that appears recent but undocumented.
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The lender denies financing until permits are verified.
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Buyers walk away entirely.
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You’re forced to pull and resolve retroactive permits under tight deadlines.
For flippers, this can kill a deal and wipe out profits. For homeowners, it can delay or derail a sale when you need it most.
Having permits shows the buyer that everything was done right and inspected properly. It increases confidence, reduces negotiation issues, and supports the property’s top market value.
4. Insurance Companies May Not Cover Unpermitted Work
This one often shocks homeowners: insurance can deny claims related to unpermitted work.
If a fire starts in an area where electrical work was done without a permit, your insurance company can legally deny your claim. The same applies to water damage from unpermitted plumbing or structural failure from unapproved framing changes.
Insurance companies look for ways to reduce payouts. Don’t give them an easy excuse.
5. Permits Ensure Contractors Are Doing Legitimate Work
Pulling a permit requires a contractor to be:
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Licensed
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Registered
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Insured
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Qualified
If a contractor is adamant about avoiding permits, that’s a strong red flag.
It usually means:
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They aren’t licensed for the work
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They don’t want oversight
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They cut corners to finish faster
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They don’t want to follow building codes
Homeowners often get burned this way—and end up paying for repairs when the contractor disappears.
By requiring permits, you ensure you’re working with a legitimate professional who is accountable to the city and the code.
6. Permits Protect Future Homeowners (and Your Reputation)
If you’re a house flipper, your entire business depends on trust and quality. When you skip permits:
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Buyers lose confidence
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Realtors hesitate to recommend you
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Inspectors flag issues that hurt your brand
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You risk lawsuits after the sale
On the flip side, flippers who pull permits build a reputation for quality. Agents love showing their homes because the paperwork is in order, and the craftsmanship is verifiable.
Permits create a paper trail that shows future buyers that safety and quality were top priorities. That’s a competitive advantage.
7. Codes Change—Permits Keep You Up to Date
Building codes evolve constantly based on new technology, safety research, and structural engineering standards.
Even if you “know someone who knows how to do it,” the work might not meet the current standard. Permits force the project to align with modern, safer practices.
That means the home ends up:
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More durable
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More energy-efficient
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Safer
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Able to pass inspection in future sales
8. The Cost of Permits Is Small Compared to the Benefits
Most homeowners assume permits are expensive or time-consuming. They’re usually:
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Affordable
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Straightforward
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Fast to obtain, especially for small projects
And the cost of not getting one? Often thousands—sometimes tens of thousands—more.
Permits give you legal protection, documentation, and safety oversight. That’s a small price to pay for long-term security.
9. Some Work Without Permits Can Turn Into Legal Trouble
If unpermitted work causes injury or major damage, you could face:
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Code violation fines
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Lawsuits
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Insurance denial
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Forced demolition
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Delayed refinancing or selling
Municipalities can also issue stop-work orders that halt your project entirely.
Permits eliminate these risks.
10. Bottom Line: Permits Are an Investment in Your Property
If you’re a homeowner, permits protect your family and your home value. If you’re a flipper, permits protect your profit, reputation, and ability to sell.
Skipping permits is like skipping the foundation on a house—it may look fine for now, but the problems eventually show up, often at the worst possible time.
Getting proper permits is one of the smartest, safest, and most financially responsible decisions you can make.
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