Thanks to all for the helpful comments. I think It boils to simply this. Fix the code problem now or fix it later.

moving the kitchen also 'triggers' several other changes that mean we're really looking at a significant remodel of the apartment which in a better market woudl probably enhance value.

The fact that spending the money to do this today, however, means that we'll have spent way more on the property than it is worth which is simply the ultimate cost of our poor due diligence when buying the apartment.

Expensive mistake i guess.

Posted by: dprxxx at July 23, 2009 8:24 PM in response to Cellar Kitchen Compliant?

I most certainly don't want to trick anyone when we come to sell the property. Frankly aside from ethics i simply couldn't take the open ended worry that a seller might have a legal case against me for misrepresenting the state of the property. No. I'd declare all i know about the property.

What struck me about the appraiser (and i agree that his ethics seem very questionable) is that he clearly believes that properties with code violations exchange hands with little or no loss of value all the time in NYC provided they have a COO.

So the question becomes... why spend all that money fixing a code violation if the property value does not suffer from it?

Some of you will have seen my post on this last year when investing in a property improvement like this may have seemed a sound idea.

Today however, with values already depressed by about 20% or more, equity lines very hard to get and little sign of any recovery in sight, such an investment is a completely different prospect.

Posted by: dprxxx at July 23, 2009 4:59 PM in response to Cellar Kitchen Compliant?

I guess what really made stop and think is the appraisers assertion that plenty of properties are sold with ' illegal ' features and in the end it makes little if any difference to their market value.

Our assumption that the value of our property is very much lower for not having a 'legal' kitchen has provided the main justification for fixing the problem. Are we being stupid and should just leave it the way it is? the Appraiser clearly believes that our architect is behaving in his own interest and not ours.

Posted by: dprxxx at July 23, 2009 4:19 PM in response to Cellar Kitchen Compliant?

Thanks for the comments.

re the 'below grade'. yes a typo sorry.

the 'cellar' (which at the rear of the building) has a ceiling height of a little more than 7'6" and Grade level (that is the level of the side walk at the front of the building) is at about 6'0" from the floor. I believe that for 'it' to be a basement it this must be at least 2'0".

the 'Cellar is large, covering the entire apartment floor plan, open plan with the kitchen at the rear and with three good sized windows and a door to a rear yard.

Our Architect also advises us that Grandfarthering in the Kitchen is not an option and goes on to we should remedy the code violation because either (i) we'd be liable if we sold the apartment without making the code violation clear to the buyer or (ii) we'd suffer a huge loss of value if we did make the code violation clar.

Clearly our Architect and builder have an interest in this so i wanted to make sure by posting here that we're not (as an appraiser told me yesterday) being "walked down the path" by our architect.

The Appraiser's view was simple....

The architect would say that wouldn't he! And.... there is very little, if any, loss of value because we have the COO and there are thousands of 'illegal' kitchens, bathrooms and bedrooms in cellars all over NYC all selling without any issues. He further adds that its standard in NYC to have a 'bought as seen' clause in the offering documents so there is no exposure to us at sale any way.

Posted by: dprxxx at July 23, 2009 3:13 PM in response to Cellar Kitchen Compliant?

60designers,

thanks for the links.

Tey seem to confirm that the cellar is covered by the COO and is ok for occupancy and use as rec room. the problem come from the fact that the only kitchen in the duplex is in there too and there is no record at DOB of this ever being approved, the addition having been carried out some time in 05 by the previous owner.

our Architect advises us that the only way we can get a fully code compliant duplex out of this is to move the kitchen upstairs to ground level. An expensive project that its self forces a major remodel of the duplex.

Our ideal solution would be to have the Cellar kitchen grand fathered in and i was posting this to see whether anyone else had managed to get something grand fathered that was put in illegally by a previous owner.

Posted by: dprxxx at July 22, 2009 11:06 PM in response to Cellar Kitchen Compliant?

Its a rear basement because the ceiling is about two feet below grade.

The COO dates back to when a connecting internal stair was put in about 20 years ago allowing the basement to be used as a rec room. The kitchen (the only one in the duplex) was there before we bought it but the DOB records make no mention of this so i presume it was added illegally i believe in 2005 because there are DOB records showing works described as...

"Filing herewith plans indicating interior renovations to an existing apartment. Worktypes to include general construction and plumbimg. No change to use egress or occupancy."

Letter of completion Jan 06. Self cert.

I presume that because DOB know nothing of the cellar kitchen they'd not agree to grandfather it in. That would solve our problem at one.

Posted by: dprxxx at July 22, 2009 10:31 PM in response to Cellar Kitchen Compliant?

Thanks for the sugestion 4.29pm, 5/8

Sorry for the delayed reply. we're on vacation.

Can you tell me the requirements that distinguish a basement from a cellar please? I recall someone in another post comenting that at least half of the room must be above grade but i don't know any more than that. Also. Grade is taken as the sidewalk level at the front of the building i believe. Is this the case for a rear basement/cellar too?

Posted by: dprxxx at May 15, 2008 9:24 PM in response to Garden Duplex

Guest. 10.03.

Thanks. A little context might help here. We’re from the UK and have no experience of buying property in NYC before this. In the UK I’ve bought and sold many times and standard practice there is that if I were to ask my Attorney to make sure that everything was legal about a property then that’s what they must do.

Typically this results in a search to make sure the seller owns the place and that there are no plans in place to build a sopping mall right next door etc. This would also reveal whether the building had been altered and that alterations were carried out in accordance with ‘building regs’ – Code in NYC.

Our concerns related to the fact tat the selling materials described the cellar as having commercial R5 zoning and we wanted to make sure we were allowed to use the cellar as part of a residential property. Frankly I wanted to make sure that some inspector was not going to turn up one day and demand to see evidence of my doctors business.

I added that while they were at it I’d like to know that all renovations were to code too.

We instructed accordingly and Our Attorney did some kind of search (as I recall we paid hard cash for this, incurred the wrath of the seller accusing us of unnecessary delay and the repeated comments from our attorney that this is unusual in NYC and that by doing this we risked losing the property. None the less we insisted.

What we got back from our attorney was that everything is fine.

I now believe that this advice was strictly correct because (1) the COO confirms that the cellar is part of the ground floor residential property and can be used as such as a recreation room and (2) the renovation work was ok’d by the DOB under directive 14 – Architect self certification. The fact that this self certification seems to have been in breach of code would not have shown up and of course it was only after closing that we’ve discovered NYC cellars should not have kitchens.

As for what we want to achieve. Well we like the apartment and the location and have no plans to leave NYC any time soon. We bought it with in intention of improving it.

Now, however, and knowing more about code requirements the options for improving the place are much less attractive so while we’ve not given up on the idea we may well just leave it as it is.

A concern is that if we make no changes what happens we do sell or possible rent the apartment out? Asking ‘who could we sue’ is really ‘who could sue us’.

I don’t want to, as has been suggested, find some other sucker sell the apartment.

This post has been very helpful. I’m left with the thought that Directive 14 leaves a aping hole for people unfamiliar with the regulation to fall in to. If an architect certifies against code then the buyer and the seller and the DOB and the attorney can be caught out.

Posted by: dprxxx at May 8, 2008 11:03 AM in response to Garden Duplex

Guest. 10.03.

Thanks. A little context might help here. We’re from the UK and have no experience of buying property in NYC before this. In the UK I’ve bought and sold many times and standard practice there is that if I were to ask my Attorney to make sure that everything was legal about a property then that’s what they must do.

Typically this results in a search to make sure the seller owns the place and that there are no plans in place to build a sopping mall right next door etc. This would also reveal whether the building had been altered and that alterations were carried out in accordance with ‘building regs’ – Code in NYC.

Our concerns related to the fact tat the selling materials described the cellar as having commercial R5 zoning and we wanted to make sure we were allowed to use the cellar as part of a residential property. Frankly I wanted to make sure that some inspector was not going to turn up one day and demand to see evidence of my doctors business.

I added that while they were at it I’d like to know that all renovations were to code too.

We instructed accordingly and Our Attorney did some kind of search (as I recall we paid hard cash for this, incurred the wrath of the seller accusing us of unnecessary delay and the repeated comments from our attorney that this is unusual in NYC and that by doing this we risked losing the property. None the less we insisted.

What we got back from our attorney was that everything is fine.

I now believe that this advice was strictly correct because (1) the COO confirms that the cellar is part of the ground floor residential property and can be used as such as a recreation room and (2) the renovation work was ok’d by the DOB under directive 14 – Architect self certification. The fact that this self certification seems to have been in breach of code would not have shown up and of course it was only after closing that we’ve discovered NYC cellars should not have kitchens.

As for what we want to achieve. Well we like the apartment and the location and have no plans to leave NYC any time soon. We bought it with in intention of improving it.

Now, however, and knowing more about code requirements the options for improving the place are much less attractive so while we’ve not given up on the idea we may well just leave it as it is.

A concern is that if we make no changes what happens we do sell or possible rent the apartment out? Asking ‘who could we sue’ is really ‘who could sue us’.

I don’t want to, as has been suggested, find some other sucker sell the apartment.

This post has been very helpful. I’m left with the thought that Directive 14 leaves a aping hole for people unfamiliar with the regulation to fall in to. If an architect certifies against code then the buyer and the seller and the DOB and the attorney can be caught out.

Posted by: dprxxx at May 8, 2008 11:03 AM in response to Garden Duplex

Thanks for the ‘frank’ replies many making the point that I’ve been a sucker here. That muck I knew already but the reason I posted here is to try and get get advice on the best way out of this mess. Buying advice has been very expensive and of very poor quality.

There are some helpful suggestions although I am not at all sure about finding another sucker.

We did what we thought was due diligence. Asking our attorney to make sure that everything about the apartment is legal for instance. They said its fine lots of hand waving and assurances that I shouldn’t worry and that I just don’t understand how things are work NYC.

Our Architect has pointed out that if the apartment was advertised and sold as an apartment the fact that it has an illegal kitchen would seem to indicate misrepresentation. His suggestions not mine.

I’m not a lawyer but presumably anything sold must be ‘fit for purpose’. The property was sold as residential apartment “with the commercial option”. I have the literature.

Reply May 7th 9.24 is helpful although I believe the building predates 1929. Reading through it we fall short of some points. Are there different regulations for building predating 1929?

The ceiling seems to be 1 foot lower than it needs to be (including drop ceiling) or barely compliant without the drop ceiling for example.

The COO shows the ‘cellar’ as an office/rec room in conjunction with 1st floor apartment. And tracking down DOB documents my self (the expeditor seems to be poor value for money) there is a letter of completion dated Jan 06 indicating self certification for work filed as a directive 14 – what ever that is. Further poking around on the website reveals the name and address of the certifying architect, the Applicant, applicant of record and filing representative.

I’ve independently established that the kitchen was fitted at this time and that the former full bath was removed to be replaced by a powder room.

Clearly DOB knows nothing of this.

The Offer documents show a floor plan completely different to the actual apartment with a full bath down stairs and no kitchen. Pretty close to how we want it.

Since the DOB have no idea what changes were made is it not possible to request grand farthing (a term I see used a lot but frankly I don’t fully understand it) of the old bathroom and renovate on that basis?

Several replies refer to my wanting to sue someone. To be clear on this, If my current position leaves me able to sue the seller then I would risk the same outcome were I to sell. I’d like to know this. If anyone can recommend an attorney to advise me on this point it would be helpful. My experience of NYC attorneys so far (the one I hired to advise me on this sale) can only be described in language the moderator would removed.

Right now I’m just trying to find out where we stand. After that the plan is to fix the problem by bringing the apartment up to code which could be a big job.

All replies, cutting and otherwise, appreciated.

Posted by: dprxxx at May 8, 2008 12:40 AM in response to Garden Duplex

The missing part of this puzzle is the condo board, who you don't mention. Fyi, much brownstone construction around here is under the radar, no filing with DOB and no CO. So in a house you could probably just do what you want and take your chances. Quite often when you sell, it's 'as is' and the seller takes what he gets and deals with the problems, if any. We certainly did, in a house which had been a rooming house, and had neither a CO or a CNO.

But in a condo, the board is usually more stringent than the DOB. So what do they say about this issue? I'd think they were concerned about the commercial property being used for residential?

Posted by: cmu at May 8, 2008 11:37 AM in response to Garden Duplex

Simple solution:

1) If you plan to sell soon, do everything legally.

2) If you really want a full bath in the cellar, disign one that can be easily converted to a closet or some other use before you sell.

3) Forget about sueing anybody. The laws in New York protect the seller and legal costs would be prohibitive.

Figure out the simplest solution and don't worry any more. You're lucky you own a townhouse to begin with.

Posted by: guest at May 8, 2008 11:38 AM in response to Garden Duplex

Ah, thanks dprxxx. That makes sense now. Of course you're not trying to sucker anyone in to anything. And I get why this is a big deal to you - you feel like you got duped and, on top of that, you're being told you can't do with your own home what you want to do.

Still sounds to me like your attorney dropped the ball and the brokers were either uninformed or were pushing hard for the sale. I guess welcome to New York on that one.

"We instructed accordingly and Our Attorney did some kind of search (as I recall we paid hard cash for this, incurred the wrath of the seller accusing us of unnecessary delay and the repeated comments from our attorney that this is unusual in NYC and that by doing this we risked losing the property. None the less we insisted."

Huge red flag, at least insofar as your attorney goes. Their job is to protect your interests, not discourage you from having all the information you need to make an informed purchase. After all, what do they stand to gain? A couple of grand more quickly than if you hold off and buy a property without these issues? So what you risk losing the property? That's always a risk before you go into contract. Minimizing that risk and maximizing your bargaining power is your attorney's job. They're supposed to run interference between you and the seller. Guess we know why the seller was in such a hurry to close.

Your architect sounds like a stand-up guy. I'd talk with him leaving aside all these potential legal issues and ask for a straight forward estimate of what it would take to get the place up to code and improve its current layout while giving you max enjoyment now and re-sale value in the future. If, of course, you don't choose to walk away from all of this, leave it as is, and take your chances down the road.

Again, best of luck. Oh, and FWIW, do try to avoid litigation - it's just a complete hassle and it may cost you your enjoyment of a home you clearly love.

Posted by: guest at May 8, 2008 11:50 AM in response to Garden Duplex

Also, litigation will drag on for years, and if you do decide to move before it is completed, you won't be able to sell it to anyone.

Yeah, finding a new attorney at that point would have been advisable. (Brokers here are generally useless and you can't rely on them not to lie about everything.) Your attorney was telling you the truth about possibly losing the sale - but should have advised you better about that not being such a bad outcome in this case, given the issues. While it is true that much renovation is not filed, and you buy as is and it turns out fine, the cellar issue should have raised a red flag for your attorney in this case.

Many attorneys in these deals are looking solely at their own bottom line - that they won't get paid if the deal doesn't close - rather than being upfront and correctly advising their clients. (Those who are afraid they won't be paid for their work if a deal doesn't close are better off asking for a retainer to cover that possibililty.)

You gotta walk away when the professionals you hire don't answer your questions to your satisfaction, even if it means losing a place (as in those cases, that is often the best outcome for you.) You didn't, and it seems you can make it both code compliant and workabale for you, if not perfect.

Posted by: guest at May 8, 2008 1:53 PM in response to Garden Duplex

What was the lawyer supposed to do? He told the truth when he said that this is how things are done in brooklyn and when he said you could lose the place because the seller felt you were delaying the deal.

The seller probably is from old school brooklyn when things were done differently and there was never any problem with the DOB butting in. Today, for better or for worse, it is different to some extent.

This is the bind the lawyer is caught in. They tell you the truth that things are still just done any which way. They also checked to see that the renovations were signed off by an architect. Was the lawyer supposed to go in there himself to measure and see that it's a cellar rather than a basement? They checked with the DOB to see how an architect filed and it came up clean. You now have another architect saying it's not. This isn't your lawyers fault and may not even be the seller's. The other architect may simply have a different opinion.

As far as I can tell the only issue here is that you want a full bath and your architect says it's not to code. You can definitely find an architect and a GC who will help you put one in that can be converted back to a half bath when you want to sell. No big deal.

Posted by: guest at May 8, 2008 3:02 PM in response to Garden Duplex

If it's any help, we recently bought a brownstone and began planning a renovation, which we hoped would include a full bath on the bottom floor. Our architect reviewed DOB records, which said that the bottom floor was a cellar, and therefore, we could not legally put in a full bath. Just by looking at it, we were convinced that the bottom floor met the requirements for a "basement" designation. So we commissioned a fresh survey, and indeed, it came back our way. To this day, we don't know what the original "cellar" designation was based on, because we could not find any prior survey with that detail included. A survey is not that expensive, and if it comes back in your favor, it may solve some of your issues.

Posted by: guest at May 8, 2008 4:29 PM in response to Garden Duplex

Thanks for the sugestion 4.29pm, 5/8

Sorry for the delayed reply. we're on vacation.

Can you tell me the requirements that distinguish a basement from a cellar please? I recall someone in another post comenting that at least half of the room must be above grade but i don't know any more than that. Also. Grade is taken as the sidewalk level at the front of the building i believe. Is this the case for a rear basement/cellar too?

Posted by: dprxxx at May 15, 2008 9:24 PM in response to Garden Duplex

Architect here. It's not that simple a question given the limited info you've offered. Here's a few links that may help identify if your apartment in its current configuration is code compliant:

http://www.housingnyc.com/html/resources/hmc/sub3/art5.html
http://www.nyc.gov/html/hpd/html/owners/illegal-conversions.shtml

Posted by: 60designers at July 22, 2009 10:43 PM in response to Cellar Kitchen Compliant?

60designers,

thanks for the links.

Tey seem to confirm that the cellar is covered by the COO and is ok for occupancy and use as rec room. the problem come from the fact that the only kitchen in the duplex is in there too and there is no record at DOB of this ever being approved, the addition having been carried out some time in 05 by the previous owner.

our Architect advises us that the only way we can get a fully code compliant duplex out of this is to move the kitchen upstairs to ground level. An expensive project that its self forces a major remodel of the duplex.

Our ideal solution would be to have the Cellar kitchen grand fathered in and i was posting this to see whether anyone else had managed to get something grand fathered that was put in illegally by a previous owner.

Posted by: dprxxx at July 22, 2009 11:06 PM in response to Cellar Kitchen Compliant?

If the ceiling of the basement is 2 feet below grade, and the DOB is not aware that there is currently a kitchen down there, I see very little chance for you getting it grandfathered in. Does the space have any windows at all? I'm trying to picture the ceiling being 2 feet below grade.

Posted by: setancre at July 23, 2009 8:41 AM in response to Cellar Kitchen Compliant?