What is a Certificate of Occupancy?

Written by Ashley Sutphin Posted On Monday, 04 July 2022 00:00

When you’re buying a home, of course, you want to know that it’s safe. When you buy a property, you need to follow some requirements, one of which may be getting a certificate of occupancy. A certificate of occupancy is also called a CO. The general idea behind the CO is that it verifies a property is suitable to live in.

Beyond that, the following are more details to know about a certificate of occupancy.

The Basics

The certificate of occupancy is a document that shows a structure, like a house or office, is safe for inhabitation. A CO includes what the property is legally classified as in terms of zoning. For example, the CO will indicate whether the property is for residential, commercial, retail, industrial or mixed-use. That means that the property is being used as it’s meant to be. For example, residential property should be used as a primary residence.

A CO verifies a property is up to code and in compliance.

The third thing a CO does is show that a property is suitable for occupation based on the standards in the municipality where it’s located.

A CO will include, along with verification that a property is up to code, the property address, a legal description including square footage, the zoning code, the owner, and any additional notes that might be relevant to the property’s safety.

You can’t live in a property or use it until there’s a certificate of occupancy issued.

When Do You Need a CO?

Local rules and specific situations determine if you need a certificate of occupancy to sell a house.

If you have a converted space, you’ll need one. Basically, what this could mean is that if you were selling a multi-family home but converting it into a single-family home before doing so, the certificate needs to show the code change. If you’re converting a business into a residential space, again, you’ll need a CO showing the change.

If you’ve made a lot of renovations, you’ll need a CO to sell it.

If you’ve done any type of remodeling, it’s best to verify whether you need a CO or not before you try to sell a home.

If you didn’t have a CO before, but you need one to sell the home, then you might have to make changes to get it up to code.

If you built a new house to sell, you’d need a CO as part of the sale.

When your home was built, there was probably a CO issued. As long as you haven’t made any major renovations or the building code hasn’t changed, then you should be able to use that one.

How Do You Get One?

If you do need a CO, then you can contact your local zoning or building department. There should be a website in the city or town where you live to indicate who to contact.

If you have an existing home, you can apply for a CO at your local building department. Sometimes you might need to show architectural plans to apply if there were extensive renovations or the home was just built.

Finally, if you do need a CO, someone has to come from the local government and inspect the home. It’s not the same as a home inspection that occurs when you’re doing a real estate transaction.

During a CO inspection, the professional will come and compare the building to the current code and make sure there are no violations. They’ll look at general building components, plumbing, electrical, fire safety, and more minor elements.

Then, at the end of the inspection, you get a report.

If you passed the inspection you can claim your CO and go forward with the home's sale. If you don’t pass, then you’ll receive a list of what needs to be fixed within a particular window of time. Once you make the repairs, you’ll have another inspection before you can move forward.

If you need a CO and you don’t get one, your transaction might not go through because a lender will not want to provide financing for a home that isn’t safe. You might also be fined by your municipality or sued.

As a final note, in some municipalities, you need a new certificate of occupancy each time you sell a property or when a new tenant moves in if it’s a rental. If you aren’t sure about anything, check with your local building or zoning authority.

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