Definition of Terms

[Seankm21]

Good morning.

I have been doing some research on various duplex and triplex properties and have come across a couple of terms that I am unsure of the meaning within the investment relm.

The first term is "legal non-conforming" property. What does that mean? Should I be running away from (or to) these? What are the issues with these?

The second term that I have seen in various listings and ads is "retrofit available". I think I understand what a retrofit is - repair or rebuild something that is broken and cannot be replaced by making something new fit while maintaining the look or integrity of the original. Am I correct in this understanding and what does it mean in regards to a investment property?

Thanks,

Sean McGleish

 

[kir]

Sometimes zoning might change by city planners, but the existing structures don't conform to the new zoning...so now it's legal non-conforming. If you do substantial alterations, you have to conform to the new zoning....



So for investment purposes, it depends on what the new zoning is.



An appraiser would say that the highest and best use of the place give you the best value. I would just evaluate your investment decision on that.





Kir.

 

[Seankm21]

Thanks Kir. I understand now that the legal non coforming has to do with the zoning of the property. What would substantial alterations be?



Sean

 

[kir]

You should check with the zoning department. Generally, it's something like 50% different from the original state.



For instance, if there was a fire, then you can't rebuilt into "legal nonconforming" status anymore.



So I'm not entirely sure where the dividing line is.


Kir.