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Way OT; Why is it this way?

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David in SC

06-27-2005 17:48:18




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Hello to all,
I wanted to share an interesting finding with you all in hopes that you all might could help me understand the justification for it. Apologize for the OT, but I read and post here daily and value and appreciate the advice I get. I recently prepared myself to build a new house on land we own in SC. I like to do what I can myself and I am prepared to spend a lot longer in order to do some things myself and save some money. The main things I intend to do myself are the trim, cabinetry, flooring, etc. No real interest in doing the jobs that would normally require a licensed contractor because my pace is just too slow. Anyhow, I planned to contract all of the subs myself. I have a basement contractor lined up and ready to move. I have already dug the basement myself. I have leads on several framing crews. And I have contacts for most of the other subs that I will need. Here is the twist that leads me to some questions:
I went to purchase a building permit and they are requiring me to sign what they call an Owner/Builder Affidavit that prohibits me from selling or renting this home for 2 years after occupancy. When I questioned the justification for this document all they would tell me is that it was a state law.
Now, I still have to use licensed contractors to perform all work that normally requires licensed, trained individuals and I still have to have/pass all mandatory inspections. And I have to be present when the inspections are done along with copies of each contractor�s license. As I see it, I am only cutting out the general contractor in hopes of saving 10-15%. Yet, I cannot sell or rent this home for 2 years after I move into it. I could almost understand this contract if I did the plumbing, heating, mechanical, etc work myself. But, that will not be the case.

What could be the justification for a state to pass this kind of law?

BTW � I did approach one builder (GC) about building this house and he had a 10 month delay until he could start due to the high demand for new construction in this area. Also, I really have no intention to build for profit. I have lived in current home for 12 years and am ready for something new. I have already signed the affidavit. I am just curious how and why they could justify this contract. Is this common in other states? I almost feel as though the intention is to discourage individuals from hiring out the building of a house without the use of a general contractor?
Your thoughts?

Thanks for the advice.
David in SC

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David in SC

07-01-2005 02:55:27




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 Thanks in reply to David in SC, 06-27-2005 17:48:18  
Thanks to all who responded. It always helps to toss things around a little and get different opinions. This site is the best I have found for doing that...Lots of knowledgeable and kind people.

Thanks,
David in Hot SC



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MarkB_MI

06-29-2005 03:41:03




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
It seems like a reasonable law, put in place to stop unlicensed contractors from doing construction using homeowner permits. If there were no crooks in the world, this would not be necessary. Unfortunately, there are a lot of shady characters in the construction business.

You won't want to sell your house in less than two years, anyway. If you do, you'll be subject to capital gains tax. Note that the gains will be based on your actual cost, NOT what it would have cost you to purchase the same home new.

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Midwest redneck

06-29-2005 01:50:08




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
I built my own house too, I moved in June of 2000. It took me 11 month start to finish, of course I have had to do stuff like build a back deck which I am 3/4 of the way done with and finish the garage and stuff like that. I believe that the reason they want you to live in it two years is to prevent the little guy from getting screwed, they figure if you live there (or have to live there) for 2 years then you will build a nice safe house...then sell in two years. In Michigan I think that law is that you have to live in the house at least one day, (big deal). A bit of advice, what ever you can do yourself, do it, and dont hire it out....to save money. I made that promise to myself and saved a lot of money which ended up as equity to me. I dont blame you for hiring out the HVAC, plumbing, and electical, but as for carpentry, trim work, painting and stuff...if you know what you are doing then great. Good luck.

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thurlow

06-29-2005 05:33:30




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 Re: Way OT; Why is it this way? in reply to Midwest redneck, 06-29-2005 01:50:08  
Hey Redneck, how 'bout a picture of your deck? Ours was 30 years old and it's time to replace it. About 16 x 30 in two levels, very retangular/conventional. Have torn it down and am pouring piers for replacement. Gonna "spice" this one up a little..... ....



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midwest redneck

06-30-2005 02:13:44




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 Re: Way OT; Why is it this way? in reply to thurlow, 06-29-2005 05:33:30  
How do you post a picture? My wife lost our digital camera, left it on top of her Jeep while driving...oops. I just stained the top boards last night with stuff called SuperDeck, dark yellow color, looks like teak. I will be doing all the railing work and posts for the railing this weekend. Deck material aint as cheap as it used to be, I remember adding onto my old deck 10 years ago for about $500 for a 100sq.ft. addition and now a 250sqft deck cost me $2,500...well it is cedar top boards and 2X8 joists with 2X10 sleepers and 25 bags of crete on the post footings.

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Cliff (VA)

06-28-2005 17:04:07




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
David,

I live in Virginia and am in the process of building my own house. I was asked to sign the same paper when I went to pick up my building permit. The reason for the rule is that so that builders cannot get around the requirement for a General Contractor's License.

You can build your own house, but you cannot build a house for others without the license. And because of the rule you cannot say it is your own house until it is completed and them immediately sell it to someone else.

I dug my own basement (with my wife and a few friends, 7 weekends). I was the architect. I drew the plans. I now am PROUD to say that I have a General Contractor and I am happy to drop any problems from my daily inspections right smack in his lap.

You may want to reconsider. GCs earn their 15%. They also tend to get MUCH better response from their subs.

I am now under roof. Most of the windows and doors are in. We hope to button it up this week and get started inside. With any luck we will be moving in early in the fall.

Good luck to you. I would be happy to discuss this with you over email or phone.

Cliff(VA) cliff at cantrellhome dot com

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John_PA

06-28-2005 08:05:42




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
Silliest thing I've heard in a while. Would SC be a red or a blue state?



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John,PA..jOHN,pa

06-29-2005 19:34:33




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 Re: Way OT; Why is it this way? in reply to John_PA, 06-28-2005 08:05:42  
This John,PA didn't ask this question. Guess I will have to say..... ..."adios".



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Easy

06-27-2005 20:01:17




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
I have never heard of this here in Michigan. When my neighbor built his house, the building inspectors were very thourgh, but professional. It is not uncommon here for people to build houses and move frequently - I know some people have made quite a bit of money that way. But building codes are enforced here - if you try to get around them you will be in court, and it will cost ya $$$$$$. Easy.

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Dug

06-27-2005 19:43:34




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
Hi David,

I think Sid has it correct. There are a lot of shysters in the world and rules like this limit their ability to screw the stupid people. Of course, people like you and I get caught in the middle, I guess that is the price for living in a civilized world.

I also plan to build my own home, plan to break ground on August 25th. I'll do the same as you, hire the foundation, framing and utilities and do the finish, floor, cabinets, etc myself. The county I live in is a real pain in the tail and I'm not looking forward to the process.

Keep us posted on your progress and any "don't dos" you run into; just might save me a headache!!!

Dug

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Stan in Oly, WA

06-27-2005 19:26:00




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
Hi, David

I'll be watching the responses to your posting with great interest. My disgust with and distrust of all levels of government make my opinion on topics like this one run a little too close to the lunatic fringe to be of much value to anyone (except lunatics, I supose) so I won't impose it on you.

My own experiences with abuses of regulatory authority and insults to common sense tend to fall more into the petty tyrant category, and less into the catering to special interest groups category that your current situation might involve.

I think that we're in for a period in which this kind of favoritism of special interests (represented by people in suits bearing gifts of cash) becomes more brazen then ever, even if not necessarily more common. Didn't people used to be ashamed to have everyone know they were crooks?

So, I guess I did it anyway; the view from space.

All the best, Stan

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Sid

06-27-2005 19:19:27




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
Lets face it. A lot of fly by nighters and shysters have rooked honest people out of hard earned money with substandard housing. Take into consideration that a lot of people now days demand that the government take care of them. You end up with a lot of laws on the books. I was involved in construction, both commerical and residential, for about thirty years and have seen a lot of things snuck by just barely meeting code. Some out there are only intrested in it standing long enough for the check to clear the bank. I feel it is unfair to say that these laws are passed to force people to use a liscened contractor. Yes I agree they seem ridiculus at times. But there is a legitamate reason for some building codes. The main reason for the two years in my opinion is in two years time most serious problems will have shown up. The shyster who intended to make a quick buck can be long gone in two weeks. A person who has had a liscensed and bonded contractor do the work has more recourse should something go wrong. So all in all it is not a bad thing. In spite of all my rambling I do think there is more red tape than needed.

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Pitch

06-28-2005 04:11:30




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 Re: Way OT; Why is it this way? in reply to Sid, 06-27-2005 19:19:27  
I have to say that it is probably forced by lobbyist for the construction trade. I NY we don't have a state law like that each town and county has its own. When I sold a house several years back the buyers bank said they needed a certificate of compliance from a licsenced plumber, couldn't find one anywhere so I just had a guy use his tax # on a letterhead. Bank accepted it. As far as I know the only trade that needs a licsence is electrician. Town I work in wants a registered contractor to do everything, a homeowner can't even change an outlet put on siding or replace a window, in contrast my town only requires that additions over 500 sq feet be signed off on by the county engineer before construction begins. The labor can be done by anyone. Homeowners can run a circuit but a new panel or subpanel must be sign off on by an electrician. Septic systems must be one of a state approved design but maybe installed by anyone. Your building permit will tell you what inspections must be done and the code officer will sign off on each stage.
As an aside, I very rarely seen a case where a contracters work is superior to a competent homeowner.

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Charles (in GA)

06-27-2005 18:57:43




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 Re: Way OT; Why is it this way? in reply to David in SC, 06-27-2005 17:48:18  
Did they offer you any information on what would happen if you did rent or sell? This law is basically one passed by the state house to the benifit of the building contractors. To force people to use a contractor for their projects.

I'll cite the applicable sections of the law, read paragraph (5) below, as it is the applicable section. I included the other two paragraphs since they also may be applicable in some circumstances.

Charles

"SECTION 40-11-360. Exemptions from application of chapter; content of posters to be distributed to building permit offices.

(A) This chapter does not apply to: ..... ..... ..

(5) An owner of residential property who improves the property or who builds or improves structures or appurtenances on the property if he does the work himself, with his own employees, or with licensed contractors; provided that the structure, group of structures, or appurtenances, including the improvements, are intended for the owner's sole occupancy or occupancy by the owner's family and are not intended for sale or rent, and provided further, that the general public does not have access to this structure. In an action brought under this chapter, proof of the sale or rent or the offering for sale or rent of the structure by the owner-builder within two years after completion or issuance of a certificate of occupancy is prima facie evidence that the project was undertaken for the purpose of sale or rent and is subject to the penalties provided in this chapter. As used in this item, "sale" or "rent" includes an arrangement by which an owner receives compensation in money, provisions, chattel, or labor from the occupancy, or the transfer of the property or the structures on the property;

(6) An owner of nonowner-occupied property who improves the property or who builds or improves structures of less than five thousand square feet or other appurtenances on the property, either by himself or with the owner's employees, if all structural and mechanical work is performed by licensed contractors regardless of the cost of construction and if the property is not sold for two years after completion of the improvements. For purposes of this item, "structural" means foundation, pier, load-bearing partition, perimeter wall, internal wall exceeding ten feet in height, roof, floor, and any other work deemed by the board to be structural. "Mechanical" means work described in Section 40-11-410(5);

(7) An owner constructing a wood-framed farm structure with less than five thousand square feet of floor space and not used for human habitation or office facilities;"

IF YOUR BUILDING PERMIT OFFICE DID NOT DISPLAY A POSTER WITH THE FOLLOWING INFORMATION ON IT, THEY ARE IN VIOLATION OF THE LAW ALSO.

"(B) The board shall distribute posters to each building permit office in the State requesting that the posters be placed in a conspicuous location to be read by applicants. The posters shall state the following:

"The South Carolina Contractor's Licensing Act requires general and mechanical construction to be performed by licensed contractors. Both the owner and the contractor are subject to penalties for violations of the law. Work performed on projects is exempt from this requirement only for the following reasons:

(1) The total cost of construction is less than $5,000.00;

(2) The property will be used solely by the owner and his immediate family as a residence for a period of at least two years;

(3) For nonresidential projects, work performed by the owner is limited to nonstructural and nonmechanical portions of the project, or;

(4) The project is a wood-framed farm building less than five thousand square feet used solely for livestock or storage.

All other work must be performed by properly licensed contractors. All persons directly employed by the owner to perform work on the project are subject to state and federal laws covering occupational safety, family and medical leave, workers' compensation, social security, income tax withholding, and minimum wage requirements. Work performed must comply with all applicable laws, ordinances, building codes, and zoning regulations."


OH YES, AND THE PENALTYS..... ..


"SECTION 40-11-200. Unlawful practice; penalty.

(A) A person who practices or offers to practice in this State in violation of this chapter or who knowingly submits false information for the purpose of obtaining a license is guilty of a misdemeanor and, upon conviction, must be imprisoned not more than one year or fined not more than five thousand dollars.

(B) It is a violation of this chapter for an awarding authority, owner, contractor, or an agent of an authority, owner, or contractor to consider a bid, sign a contract, or allow a contractor to begin work unless the bidder or contractor has first obtained the licenses required by this chapter. Bids or contracts submitted by contractors may not be reconsidered or resubmitted to an awarding authority, contractor, or owner if the contractor was not properly licensed at the time the initial bid or contract was submitted.

(C) Charges under this section may be preferred by the board by delivering evidence of a violation to a solicitor or a magistrate having jurisdiction.

(D) Upon conviction under this section, the fines and assessments imposed by a court must be administered pursuant to Sections 14-1-205, 14-1-206, 14-1-207, 14-1-208, and 14-1-209."

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