What does a Certificate of Occupancy do?

The Certificate of Occupancy (CO) is an essential document in real estate that demonstrates compliance with local building and fire codes. When a building is constructed or undergoes significant renovations, the local government inspects the property to ensure it meets all necessary safety and zoning regulations. Once the property passes these inspections, the Certificate of Occupancy is issued, signifying that the building is safe for occupancy and has been constructed to the minimum standards required by law.

This document is crucial because it assures tenants, owners, and potential buyers that the property adheres to safety standards, which can impact legal liability and the insurability of the property. Without a CO, occupants may be at risk of safety violations, and any potential buyer might hesitate to purchase the property due to uncertainty about its compliance with regulations.

The other options, while they represent various aspects of real estate processes, do not accurately capture the primary purpose of a Certificate of Occupancy. Establishing insurance coverage is related to the insurance policy taken on the property, property tax assessments are usually determined through local tax authorities based on property valuation rather than occupancy status, and certifying a deed transfer pertains to the legal transfer of ownership rather than occupancy compliance.