Selling a Home with Unpermitted Work in California

8 min read · Last reviewed April 2026

Selling a home with known unpermitted work in California requires careful handling. Failure to disclose can expose you to lawsuits from the buyer, and the way you handle disclosure can significantly affect both the sale price and your legal risk.

California Disclosure Requirements

Under California Civil Code §1102 et seq., sellers must complete a Transfer Disclosure Statement (TDS) that discloses known material facts about the property. Known unpermitted work is a material fact that must be disclosed.

Additionally, the Real Estate Transfer Disclosure Statement specifically asks about additions, structural modifications, and other alterations. If you know about unpermitted work, you must disclose it in response to these questions.

Options Before Selling

Legalize the work: Apply for after-the-fact permits. If the work passes inspection, you can sell with a clean permit record.

Disclose and price accordingly: Sell the property with full disclosure of the unpermitted work. Buyers will typically negotiate a lower price to account for the cost and risk of legalizing the work themselves.

Correct or remove: If the work cannot be permitted, consider correcting it to meet code or removing it before listing.

Risks of Non-Disclosure

If you know about unpermitted work and fail to disclose it, the buyer can potentially:

• Sue you for the cost of legalizing or correcting the work
• Sue you for diminished property value
• Seek rescission (cancellation) of the sale
• Recover attorney's fees in some cases

The statute of limitations for non-disclosure claims generally runs from the date the buyer discovers the unpermitted work, not from the date of sale.