What is An Occupancy Permit?

Rick Sheppard
Published on March 25, 2020

What is An Occupancy Permit?

Selling a house can be a difficult process.  There’s preparing the house (and yourself) for the sale.  The house – physically and financially, and you – emotionally.  There’s selecting a real estate company and specific agent to represent you in the marketing and sale of your house.  Or you could market and sell your home yourself – an especially difficult task unless you have a fair amount of experience buying and selling properties.

You need to prepare for buyer appointments (also called showings).  Once you receive an offer, there are contracts to read, understand, negotiate, and sign; inspections and appraisals to be conducted; a courthouse title search to be performed; coordinating the settlement with a mortgage company and a settlement company.  And you’ll need to work with any lienholders to make sure that all debt connected to the property, including real estate taxes, is satisfied at the time of settlement.  The list goes on and on – there are a lot of steps involved in the sale of a house.

And depending on the municipality your property is located in, you may have one more matter to address – a municipal inspection, possible required repairs, the issuance of an “occupancy permit” after repairs are completed, and the costs associated with all this.  These permits are called a “Use and Occupancy” permit, or “Certificate of Occupancy” permit and serve the purpose of letting all involved parties know that the municipality has officially inspected the property and deemed it to be, in their inspector’s opinion, “suitable for occupancy”.

What sort of things does an inspector look for at the inspection?  Generally, the focus is on safety related items such as missing smoke and carbon monoxide detectors, loose handrails, damaged floorboards, missing ground fault protection outlets and other electrical concerns.  Often a missing house number will raise a red flag – 911 emergency vehicles can better find a home with a number on the door or mailbox.

Bottom line: yes, this is definitely “Big Brother” getting into your private business.  And to be fair, not all municipalities require an occupancy permit when a property is sold, which could cause one to wonder why any municipality has such a law (ordinance) on its books.  Put another way, since occupancy permits are not deemed important enough to be universally established laws across all municipalities, is an occupancy permit really all that important?  The answer depends on who you ask.  The official at a municipality that requires an occupancy permit will say the law is in place to “protect its citizens”.  The official at a municipality that does not require an occupancy permit may very well look at you a little funny and reply “What is an occupancy permit?”  For example, Perkiomen Township, PA requires an occupancy permit.  Here is copy of their application to give you some idea of what one looks like.  You should find most applications online at the municipality websites.

One thing’s for sure: if you need an occupancy permit and/or the inspection for that permit requires repairs to your house before you can sell it, someone will need to pick up the ensuing tab… and you can bet it won’t be your municipality.  You or your buyer will absorb the costs, adding to the overall cost of selling your house.  Here’s hoping that those repairs and the repair costs don’t cause your buyer to void the sale, forcing you to start all over again in your effort to sell your house.  Another thought: who is responsible if the inspector is somehow negligent in his/her inspection?  The municipality?  The inspector?  Seems to be a worthwhile question to ask when you first schedule that inspection.

They say you can’t fight city hall, but you can at least educate yourself as much as possible before dealing with city hall.  And hey, if you do need to obtain an occupancy permit, at least you can feel safe in knowing that your municipality is “protecting” you!

I’ve sold and settled hundreds of properties in my real estate career and many of those sales required an occupancy permit.  To make the process go as smoothly as possible, I educate my clients upfront as to their municipality’s occupancy permit requirements.  And I directly coordinate and attend the occupancy permit inspections – all with the goal of eliminating problems before they start!  If you have questions about an occupancy permit, or anything else, for that matter, please do not hesitate to contact me.  I’ll be happy to help.

The author, Rick Sheppard, is a licensed real estate broker with RE/MAX Achievers, Inc in Pennsylvania and a 32+ year veteran of the real estate trenches.  He knows a lot because he’s seen a lot.  If you have any questions about this or any real estate related topic, feel free to contact Rick at [email protected] and he’ll do his best to answer your questions.

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