You're a lawyer, so you expect people to pay you for the valuable knowledge and experience you have.
So it's puzzling that when you seek advice yourself, you avoid paying for the knowledge and experience of a mortgage broker or a real estate lawyer in the location you're moving to, and instead you seek advice from people whose only credential is that they're (probably) frum.
You're the one who'll have to pay for it, and live in it, so you have to decide how much risk and money and effort this house is worth, if you'd want to be responsible for any needed renovation yourself, how much time it will take to find another at the same cost in the same neighborhood (and which might have risks of their own), etc.
If it were me, I'd hire a real estate lawyer (or a mortgage broker? or a different real estate agent?) to get advice on how these issues are generally handled in your new location (Is the municipality a stickler for permits? Are they likely to make you tear it all down?) and how they have written contracts in the past for unpermitted sales (Are the sellers asked to fix things beforehand? Is the cost of the home just cut significantly? Do they guarantee that the seller would reimburse you for up to a certain amount? Does the contractor send the bill to the seller?)
Another reason to get a third party involved is that they can act as a neutral intermediary. Telling the seller "get this done or we'll walk," may rub them the wrong way, even if they would have otherwise been willing to pay the expenses. It might be better to have advice from someone with experience in this kind of negotiation.
I understand that you're a hands-on, do-it-yourself kind of guy, but professional advice might be worth the money in the long run.
