Building Illegally – Don’t Risk Your Property Investment

Illegal Builder
Building illegally just isn’t worth the risk

Let’s say you’ve purchased or are about to purchase an apartment in Israel and you discover that it’s not built in accordance with the building permit. Or perhaps you own an apartment and are considering expanding but don’t want to spend the time or money on the legal issues.  What’s the worst thing that could happen?  After all, who’ll even know?  Who’ll care?

Well, it turns out that someone will know. And someone will care. And it will cost you dearly.

Here are five worst-case scenarios if you build an extra room without the correct legal paperwork in place.

1.  Legally the municipality can issue an order to demolish the addition.  Not only will you lose all the money you spent on the addition, but you will also have to pay a hefty fine.

2.  The municipality could take you to court for building illegally, but they are often willing to issue a permit if you apply for one. You’ll pay the expenses of the permit plus a large fine.

3.  You may find it impossible to sell your apartment.  You are required to notify prospective buyers that part of the apartment does not have a building permit and many buyers will no longer be interested in buying your property as a result.

4.  You or your buyer may find it difficult to get a sufficient mortgage. The mortgage banks require an appraisal of any property before authorizing a mortgage. The appraiser will only appraise the part of the apartment that is built legally. This means that the worth of the apartment in the appraisal will go down and the amount of the mortgage will go down accordingly. If your buyer planned to take a mortgage that is a high percentage of the price of the property, this could torpedo the deal.

5.  Your neighbors and prospective buyers can sue you for building illegally.

Building illegally may seem like a good idea at the time, but deciding to deliberately break the law will come back to haunt you. Don’t risk it.