The Hidden Cost Of Unpermitted Construction In Chattanooga

  • Monday, June 30, 2025

They say the housing market is in the dumps, but why? Building permits have a significant impact on the housing market because they serve as both a leading indicator of future construction and a control mechanism for development.

Analysts, banks, and developers use permit trends to predict where the market is headed. When many permits are approved and construction follows, the increase in housing supply can help cool the market. But when fewer permits are issued, it can tighten supply, especially in high-demand areas, driving up home prices.

Completely skipping the permit process can decrease a property's market value, delay or even cancel a potential sale, and may force the seller to obtain retroactive permits or remove the unapproved work entirely. Unpermitted construction isn’t tracked, which leads to inaccurate housing data that distorts the overall picture.

Unpermitted construction in Chattanooga is happening. I have seen entire small neighborhoods bought out, followed by aggressive remodeling. Restoring and improving a neighborhood’s appearance is a good thing, but at what cost?

Is all that remodeling work being done legally? I can guarantee you it is not. Are all those workers licensed contractors? Again, I guarantee they are not. Anyone hired by the homeowner is considered a prime contractor or construction manager, and they are not exempt from licensing requirements.

A negative domino effect is bound to happen if building codes and permitting policies are not actively enforced, because right now, they are only “enforced”.

Rachel Barnes

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