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Whether you are building a house or making major modifications to it, chances are you will need to obtain a building permit. The cost of a building permit varies depending on a number of factors and can significantly increase the overall cost of a project. Here’s what you need to know.

How much does a building permit cost?

On average, building permits can range from $50 for small improvements to $2,000 or more for major construction or renovations. The cost depends on the location of the project and the project itself, so it can vary greatly.

“Costs are everywhere,” says Mindy Jensen, real estate agent at Equity Colorado Real Estate, a veteran pinball machine and community manager for BiggerPockets, a real estate investing site.

“I recently purchased a license to upgrade [an] electrical circuit from 60 amps to 200 amps. It cost $700,” Jensen recalls. “If I just upgraded to 100 amps, it would have cost $100.”

For exact costs, Jensen recommends contacting your city’s building department ahead of time and asking what the requirements are. If you are completing a second story addition, for example, you may need to show the plans to the building department and have them approved by a structural engineer.

“Every city is different, even within counties within a state,” Jensen says.

Why do I need a building permit?

Don’t make the renovation mistake of forgetting a building permit. Whenever you build a new home or make substantial modifications to it, the jurisdiction in which the property is located will likely require a permit. Permits allow your local authority to monitor changes to properties and ensure a degree of uniformity in new builds or upgrades so homes meet a similar standard or code.

However, different jurisdictions have different requirements. Some won’t need a permit for projects like replacing kitchen cabinets, but if you have to open walls, chances are you’ll need a permit. It’s always best to check with your local permit office before embarking on a project that requires major work, says Jensen.

Common permit types

In general, the most common types of building permits are those related to opening a wall or building some type of new structure. According to Jensen, you’ll likely need a permit to:

  • Electric
  • Plumbing
  • HVAC
  • Insulation
  • Management
  • Certain isolated constructions (large sheds, guest houses)
  • Certain attached structures (bridges)

You don’t usually need to get a drywall permit, but it will be part of the process in many cases, Jensen points out.

For example, “you’ll need to install new drywall when you finish any plumbing or electrical work,” says Jensen. “You can also check with your city’s permit department to see if they have general permits, like a basement finishing permit, that covers all the things you might need to do through the process. “

How long does it take to get a permit?

Like the cost, the time to obtain a building permit depends on the location and the project. For smaller projects, you can enter and exit the permit office the same day, Jensen says. For larger and more complex projects, it can take up to six months.

Additional approvals may also cause delays. If you plan to add a second floor to your house or build an addition, for example, you may need to do an environmental analysis or submit plans drawn up by an architect.

Simply having a permit is not the end of the process either. You will also be subject to inspection at various points. Using the example of drywall, you will need an inspector to examine the plumbing or electrical work behind the wall before you install the drywall. The inspector will return once the project is complete and the permit will be closed once the final inspection is complete.

“You need final approval to close the permit. Leaving it open means you haven’t met the requirements,” Jensen says, adding “It’s not just about getting permission to make big changes; this is to ensure that the work will not endanger the next person who will buy the house.

Do I need to hire someone to pick up a permit?

It may make sense for you to hire someone else to get a building permit, although Jensen personally never did.

“There are cities where it’s difficult to get a permit and where there are a lot of complicated steps,” says Jensen. “Start by looking at how complicated the process is. Hiring someone who knows the system can help you get through it and maybe even get your license faster.

Typically, you can expect to pay around $60 per hour to a permit shipper, but there may be other fees or minimums to meet on top of that.

If you have a general contractor working with you on a large building or renovation project, you may be able to factor the cost of your building permits into the overall cost of the project, with the contractor ensuring that all permits appropriate are obtained.

What if work is done without permission?

There are usually no immediate consequences when you carry out work without planning permission. The real problems tend to come later.

“If you don’t get a permit and something happens, your insurance might not cover the damage,” Jensen says. “[Say] you are doing plumbing work, there is a water leak and damage. The insurance company verifies whether your upgrade has been authorized. If not, they can deny the claim.

Not having a permit for renovations you have done in the past can also affect the sale price of your home in the future, and even your ability to sell it.

Remember that it is not enough to obtain the permit; you must also have the final inspection to close it.

“If you don’t close the permits, you might have to do a lot of work to get it up to code later,” Jensen says. “A home inspector for sale can require you to spend a lot of money to do work that should have been done differently.”

In the end, it’s best to err on the side of caution.

“If you have to wonder if you need a building permit, the answer is probably yes,” says Jensen. “Your building department can tell you exactly what you need.”

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