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IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson. January 1, 2018

As you may or may not be aware, the County Council has recently adopted updates to the Shoreline Master Program (SMP), with the new regulations effective on October 30, 2017. Although the new regulations apply to all shoreline development, the focus of this article will be on regulations related to residential development in the County.

I recently had the pleasure of processing a waterfront transaction where my clients had numerous questions about what they could change on the property to make the home suitable to them. We were able to process a Residential Pre Application (RPA) at the County and obtain the answers to my client’s questions. It was a very positive experience if you don’t take into consideration the added expense. Some of the questions and issues that we had and what I learned are listed below:

If the development (typically a single-family residence and/or associated accessory buildings) on the property are closer to the top of bank or ordinary high water mark than allowed by current regulations, the structure(s) are considered “non-conforming”. Generally the current regulation is 100 feet. Another common condition that creates non-conformity is if the width of the structure(s) occupies more than 50% of the lot width at the seaward face of the structure(s). Setbacks and lot width coverage regulations have enough variation depending on the individual parcel that assessment is needed on a case-by-case basis. There are additional conditions that can relegate structure(s) and/or use(s) to a non-conforming status, but the 2 listed above are the most common.

If the property has structures that are non-conforming, then proposed new development, expansion and/or repairs, the following steps are necessary:

The structure may be moved, replaced, redeveloped, expanded or otherwise modified on the same parcel provided this work is consistent with the provisions listed below:

The application must demonstrate that the proposed action will not:
1. Result in a net loss of shoreline ecological functions;
2. Increase adverse impacts on the shoreline critical areas;
3. Create a new non-conformance or increase the degree of inconsistency with provisions of this SMP; or
4. Results in hazard to people or property.

In order to demonstrate no net loss of shoreline ecological functions, the application must provide an analysis that addresses any:

A. Increase in the quantity of pollutants from the site;
B. Increase in the quantity of surface runoff from the site;
C. Decrease in trees and other vegetation within buffers and tree protection zones;
D. Decrease in the stability of the site and other properties; and
E. Changes to the transport of sediment to and within nearshore areas.

I confirmed that each analysis report prepared to demonstrate compliance would have a validity period of around 5 years unless regulations change. As my clients plan to make the improvements to the property within the next 3 years, the studies and reporting they had done when contemplating their purchase will carry over to their permit application.

In this situation the property was developed starting in the 1970s thru 1980. The 1,974 square foot main home is considered non-confirming due to the proximity to the shoreline. The property was also improved with a small guest home and a single use dock.

If the home had been conforming, then most of the steps listed below would not have been required. As the shoreline rules have become more restrictive over time, a good portion of shoreline houses are non-conforming, so the processes described below would be common for owners wanting to remodel or expand an existing shoreline residence.

As an agent, if a client is considering a property purchase that may be subject to these regulations, I would highly recommend this research be done as part of a feasibility study, prior to closing. The risk is too great to acquire the property and hope for the best.

The Feasibility Contingencies:
As part of the standard real estate transaction the buyers hired a home inspector to determine if the present condition of the home was suitable to them. The cost of the home inspection was $595.

We then processed a Residential Pre Application (RPA) with a local land use consultant and he submitted it to the County within a few days. Since the property was located on San Juan Island, the County was able to schedule their site visit and complete their report in a very timely manner. Properties on other islands require additional travel by staff and would take a little bit longer.

The written RPA report issued by the County is valid until the next Critical Areas Ordinance or Shoreline Master Program update which is estimated for about 5 years from now. Once the RPA was submitted to San Juan County, a site visit was conducted and a written response to the project specific questions we submitted was provided. Additionally the report provided general information about setbacks, critical areas, and other regulations. It is important to note that the RPA is not a permit and does not vest the project: only a permit will do that. The cost of the RPA including the County fees was $2,000.

We confirmed that, subject to the formal permit process, it may be possible to increase the size of the main house to allow for an additional bedroom. The home was 1,974 square feet and had one bedroom and a den. With the new regulations, we no longer have a limit on increasing the size of an existing non-conforming residence. Prior there was a 25% increase limitation formula. Now the size of allowable expansion is based on the compliance with regulations 1-4 and subsections A-E referenced above.

We confirmed that the small, existing guest house may be increased in size by adding additional space above as a second story and/or to the back of the dwelling away from the shoreline. In no event could we increase towards the shoreline or increase the size of that structure more than 1,000 square feet unless we removed the range in the kitchen and changed the use from guest house (ADU) to a bunkhouse or studio. My clients were advised it would never to possible to expand closer to the shoreline in the beginning of their research and the RPA report confirmed this.

We confirmed that a garage with living space above could be constructed on the site on the back of the lot, located beyond the tree protection zones. (110 feet from Ordinary High Water Mark - OHWM.) The garage living space may not have a kitchen.

When considering expansion that involves additional bedrooms, the size of the septic system dictates the maximum number of permitted bedrooms on the site. Subject to soil conditions, some systems may be expanded to accommodate additional future bedrooms.

Next, we hired an archaeologist to inspect the site and issue a report on the property as it was revealed that the property is located within an archeological buffer and had an area containing archaeologically sensitive materials. The firm dug several test pits and confirmed that a portion of the property on the shoreline edge contained sensitive material however; no sensitive materials were located near the proposed expansion sites for the remodel or new construction. The report was sent to the State, County and local Tribes for their review and comments. The local Tribe recommended that the construction crew be trained and provided an Inadvertent Discovery Plan (IDP) that was very workable. This plan is provided by our County at no charge. The cost of the archaeologist investigation and report was $3,000.

We hired a surveyor to locate all of the property boundaries and corners stakes and confirm that no structures encroached on to this property, or from our property on to adjacent properties. The cost of the survey was $2,800. Additional work will be needed to survey the exact location of the existing and proposed buildings to create a plot plan for the actual permit application submission.

A substantial portion of shoreline parcels may be located in or near a flood zone. If that situation occurs, prior to development, the owner’s would need to hire a licensed surveyor to determine the base flood elevation (BFE) for the home and if applicable, process a Letter of Map Amendment (LOMA) so that flood insurance could be waived. The cost of the investigation and preparation/submittal of the LOMA would run around $2,200.

We hired an inspector to inspect the septic system and confirm that the maintenance components were in place and pump the system tank. The cost was $221 for the inspection and $1,000 for the pumping.

We hired the well drilling firm to take samples of the well water and send them to the Mt Vernon laboratories for testing. As the home had been vacant for a while the first bacteria test failed and the system required a flush. The cost for water testing and analysis of the well was around $400.

We hired a Geomorphologist (earth & environmental sciences manager) to process a biological assessment to support the regulatory requirement demonstrating the proposed development results in no net loss of shoreline ecological function. They conducted a study of the property and proposed mitigation recommendations for the proposed construction to insure no net loss. The cost of the study was $3,000.

This site’s protection/mitigation recommendations include a storm water management plan, adding gutters to the building(s), site drainage control, and possible revegetation of native shrubs and trees. As we have a newer Advantex™ septic system, no upgrades were required to insure the quantity of pollutants related to septic waste did not increase. Our land use consultant will be able to prepare the storm water management plan and the typical cost is in the range of $1,200-$1,600. Due to the age of the home, no gutters had been installed originally so the cost of those will be incorporated into the future remodel budget.

The property also contains an older boat dock. No permits were found for the dock, however it was originally constructed sometime in 1960, before the County planning department and SMP existed. The present condition of the dock will require eventual repairs. Normal maintenance and repair of an existing dock is exempt from shoreline substantial development permit requirements and as a result, the dock can be maintained and repaired or replaced, subject to the conditions in the SMP regulations. The County confirmed this in the RPA report; however, we must comply with the design requirement for grating on the walking surfaces. In order to repair the dock, we will apply for the shoreline exemption “permit” and hire a professional to make repairs compliant to current design. The cost of a shoreline exemption will be $1,200 in this case.

The owners may need to hire a marine biologist to complete the biological assessment required to accompany the shoreline exemption application that confirms no increase in adverse impacts on the shoreline critical areas. This should be easily met, as the plan is to only replace the float and not try to increase the size of the dock or alter pilings. In our case, we can combine this study with the one that addresses no net loss to the shoreline ecological functions for the proposed new building construction and additions, so no additional costs. If this were a standalone assessment for the dock repair or replacement, the cost would be around $3,000.

I found the entire experience very positive. I was able to arrange the answers for my clients with island professionals and County employees. One downside of a standard escrow term of 45 to 60 days is that it is not reasonable to obtain the various reports needed to address client concerns during their feasibility contingency period. In this case, and likely common to other properties, we phased in the professional studies and reports as the results of a previous study had an impact on the next. The next professional was hired only after the last one confirmed we were still able to move forward with the original design ideas. If a client had ordered all of the reports immediately, the time frames may have been met, however; if an increase to the structure had not been allowed, the need for the archeologist or biologist would not have been necessary. In most transactions I believe the professionals will be hired in phases. I would recommend that buyers, sellers and their agents allow for at least 90 days to process this type of complicated transaction so that the service providers and County employees are not under as much pressure.

To expedite the process, a few of the studies could be processed by the seller at their expense prior to marketing the property. I can recommend archaeology, flood insurance determination (BFE) with LOMA if possible, and geological hazard study, as these are standard. The seller must check with a land use consultant or the County prior to ordering any of these reports to make sure they will be required. A seller would be unable to process the study that confirms no net loss to the shoreline ecological functions as it not possible to predict if and what the buyer intends to change to the improvements.

If the lot were unimproved, having the seller arrange for an RPA for a buyer would be beneficial if it was submitted and approved based on maximum capacity. If the buyer elects, they can always reduce the building size.

A client could be spending upwards of $15,000-$20,000 as part of their feasibility study, including standard transaction expenses. If the transaction fails due to any one of the property issues or due to a buyer’s contingency such as financing, the buyer is left with $15,000 in reports that are worthless to them. The costs above total $20,000 but some expenses in this transaction were deferred until after closing.

The process was very informative and the cooperation from the County employees was very helpful. However, I can state that the new regulations have made construction in the shoreline cost more and take longer. It is not a process for those that are easily frustrated. I think the process should be good for all involved; humans and the environment but I make that statement with a slight hesitation, as I have had only one transaction endure this process since the new regulation effective date.

Each waterfront parcel is unique. The conditions found on this site contain some, but not all, of the regulatory hurdles you may encounter. As an example, some areas of the shoreline have been identified as geologically hazardous, thereby requiring a geotechnical investigation. While not every waterfront parcel will have all of these issues, they need to be evaluated to ascertain the extent and nature of regulatory burdens and issues. The purpose of this article was to share the insight gained about the process, including the most common events and expenses.

If you would like the contact information for the land use consultant, the surveyor, the well purveyor, the septic inspector, the home inspector, the general contractors for the remodel, the archaeologist, the marine biologist and/or the geologist/hydrogeologist), be sure to contact me.

So here is my standard disclosure: This article is for informational purposes only and not intended to be all inclusive of everything you should know about remodeling, repairing or expanding a non-conforming waterfront property in San Juan County.



IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson, January 1, 2018

In reviewing the year-end results for 2017, the sales dollar volume for the real estate market in San Juan County per the Northwest Multiple Listing Service was $299,943,083 which reflects an increase in volume of 19.5% over 2016 when the volume was $251,020,953. The percentage of growth this year was very similar to the increase we enjoyed for the last several years; very stable controlled growth is much more sustainable. The County closed an average of 49.3 transactions per month which is above the last few years.

Total volume on San Juan Island in 2017 was $147,980,853 as compared to $124,582,355 in 2016. The increase is 18.7%, very similar to the increase the County enjoyed. On San Juan Island we closed an average of 24.4 transactions per month. Again above the last few years.

volume2 (613k image)

In addition to healthy volume increases, other positive data for San Juan Island property owners includes decreasing inventory levels. There was a 22% decrease in inventory numbers in January 2018 as compared to January 2017. This decrease percentage was less than last year but still notable.

Inventory2 (599k image)

The smaller percentage decrease in inventory may be attributed to the fact that many of the land owners were holding off for more recovery, and then decided to list in 2017 as land was moving at a good pace. This would have increased the inventory in the land category. Closed Land sales in 2017 for San Juan Island totaled 106 transactions for $20,170,007 in volume. In 2016 the total transaction number was only 52 for $12,733,250 in volume. The increase for the period was 103% in the transaction number and 63% in volume. I personally sold more land in 2017 than I had since prior to the recession.

The popularity of a land purchase is a direct reflection of the decreases in home inventory. When buyers are unable to find an existing home that is suitable, they consider custom construction. Another thought, it is more affordable for a person to secure a “place-saver” on our island via purchasing land versus a home that requires maintenance until they are ready to relocate. Most of the clients I worked with in 2017 aren’t planning on improving their land until several years from now.

One more thought; many of the land sales at Roche Harbor will be future speculative construction or rentals homes held for investment. If there was ever a time with reduced risk for speculative construction, it is now and Roche Harbor is one of the best places.

Further good news regarding land sales includes more recovery in the waterfront lot category. On both San Juan Island and the County the increases in volume and transaction numbers are notable and identical; a 150% increase in transaction numbers and a 300% increase in volume. The increases in the waterfront home category were typical to the overall market activity, however; I noted more non-conforming waterfront cabins were in the mix. This news is comforting as buyers and property owners are now more accepting of the new regulations created by the Critical Areas Ordinance (CAO) in 2014 and the Shoreline Management Program (SMP) in 2017 that had an impact on waterfront lots and homes. As long as the SMP appeal process doesn’t upset the energy, the uncertainty created by the new regulations has diminished.

There are many positive statistics regarding the market trends in our County and I have provided the details below.

Highlights of our market:

• The median home price for a 12 month period ending December 2017 for the County and San Juan Island reflect increases of 9% and 14%, respectively. The median is a typical market price where half of the homes sold for more and half sold for less
Increases in median prices indicate our market is headed in the right direction but it is not a measurement of price appreciation. The actual computation of appreciation or depreciation would include analyzing a number of properties that were sold in 2016 and again in 2017. Due to how small of a market we are, it is difficult to have a reliable number of similar properties that transact in a two year period. Bottom line, we are too small of a market to quote an appreciation figure.

• The Average days on market number (DOM) for homes in the County and on San Juan Island was 201 and 178, respectively. In all categories of our properties and prices, the days on market has decreased since 2016. The range was 101 to 336 for the County and 67 to 341 for San Juan Island. The DOM varies on the price range.

• Waterfront home sales represented 36.3% of our total dollar volume for the County and 36.6% for San Juan Island. These percentages are typical for a healthy market in the Islands and almost identical to last year.

• Sellers negotiated on average 5.2% off the list price at the time of sale for homes in the County and 4.5% for San Juan Island. This is down slightly from year-end 2017. This percentage varies based on the price range.

• Sellers negotiated on average 9.2% off the list price at the time of sale for land in the County and 10.8% on San Juan Island. This is also down slightly from year-end 2017. Again, this percentage varies based on the price range.

• The number of sales in excess of $1,000,000 increased in both the County and on San Juan Island. The increase in number of transactions for the County was 26% and the increase for San Juan Island was 42%.

• Coldwell Banker San Juan Islands Inc. had a good year with an increase of 16% in transaction number. The majority of our agents had volume in excess of what they closed in 2016.

• Inventory is down in most all categories of listings. One should note that I am using year-end figures and many agents set their listing expiration date for 12-31 so the decrease in inventory is also impacted by the expired listings. Year-after-year it is the same situation, although there appeared to be a higher level of expired listings this year. Many sellers remove their property from active marketing during the winter to give the listing a “rest”.

• Absorption has been strong in every category and based on the current inventory levels and number of closed sales in 2017 for San Juan Island, we have 5.66 months of supply for homes under $1M and a 1 year supply for homes listed above $1M. The supply for homes listed under $400,000 is similar at 5.79 months but we drop down to under 4 months for homes listed under $300,000. Six months is considered a balanced market. The calculation for months of inventory is just a point in time and any changes in inventory render the calculation incorrect.

Charts: I have prepared numerous charts that reflect data from 2017 and historic comparable statistics for those that desire more detail. Please use the link below to the charts.

2017 Year End Charts or visit My Blog

Showcase of Listings: The Coldwell Banker San Juan Islands Showcase of Listings deadline this year is April 1, 2018. If you are considering selling your property this year, this is an excellent publication to be included in. The showcase is a handout at our Friday Harbor and Roche Harbor offices as well as on the ferry system. We handout over 15,000.

Procedures to Purchasing on San Juan Island


IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson

1. Select an Agent to Represent You
As you may be aware, all of the brokerage firms on San Juan Island are members of the Northwest Multiple Listing Service; therefore, any of the agents can assist you with any of the properties listed with Coldwell Banker or other brokerage firms. One of the first steps in purchasing real estate on San Juan is to select an agent to represent you. Ideally you should select ONE agent that you feel will provide you with the level of customer service that you require.

It is important for you to understand the Law of Real Estate Agency. The State law allows for three types of agency representation:

• Buyer’s representation is when the agent is representing the buyer and intends to obtain property at the lowest possible sales price.
• Seller’s representation is when the agent has a listing with the seller and is attempting to obtain the highest possible sales price.
• Dual agency is when the agent shows a buyer one of their own listings and the buyer decides to purchase it. In the case of dual agency, the agent represents the seller as well as the buyer.

2. Determine Your Source of Funds
• Cash at Closing
• Institutional Financing
• Seller Financing
• 1031 Tax Exchange

If you intend to finance your purchase, it is prudent to meet with your lender and determine the maximum loan amount you are qualified for. This amount, coupled with the cash you have allocated, will determine the maximum sales price. We have numerous lenders that are active with financing in the islands if you are interested.

3. Determine the Type of Property You Desire to Purchase
One of the best ways to do this is to develop a list of your desired property features, and a list that details how you intend to use the property. Then prioritize those lists. For example, when I am working with a waterfront purchaser, I obtain the following information:

• Is beach access required or is high bank OK?
• Do you have a boat? Do you plan to buy a boat?
• Bay protection or west side open with current?
• Bay view or expansive wide open?
• Do you want to be near crabbing and clamming?
• Do you want to see the whales, boat traffic and/or sunsets?
• Amount of trees, direction of sun exposure and amount of privacy?

The responses received may direct me to property in different locations on the island. However, it may be that until a buyer has an opportunity to view the various types of properties, they may not be able to narrow down or develop their priorities.

4. Educate yourself on the Market and Inventory
You need to become acquainted with our market and inventory level in the categories that hold your interest. Even if your purchase plans are sometime in the future, it is beneficial to take the time to view property because it will save you time in the long run. This process allows you to get acquainted, relate your preferences and develop your knowledge of the market. This will also help me to customize all future information sent to you. Buying property is a process of elimination. You will view many properties which you will determine are not suitable; then you will buy the one that is.

One way to monitor our market is to review my Quarterly Real Estate Market Updates. You can also sign up for the service on my website located at

5. Monitor the Inventory
You need to stay in touch with the inventory and market trends until the right time or right property becomes available. If you have viewed property with me or communicated your preferences, I will establish an account for you in our IDX and all new listings that meet your criteria will be emailed to you upon their origination. Purchasing property in the Islands can be a one day or ten year process - which is totally subject to your time frame.

Purchase and Sale Transaction
Once you have located the property you desire to purchase, I will structure a written offer to purchase containing the terms and conditions you have specified. The seller will either accept your offer as submitted or submit, through their agent, a counteroffer containing terms that are acceptable to them.
Important elements that should be included in the Purchase Agreement under the feasibility study provision are listed below:

Archeological Sensitive Areas
You want to make sure that the property you are purchasing is not located in an archeological sensitive area such as Indian Midden or near a cemetery. To confirm this information you need to contact Nadine Cook at San Juan County building department. She will look up the property on their maps and confirm the results. The maps are not of public record so you may not access the information yourself. If the property is located within an Archeological Sensitive Area, you will need to obtain a report from an Archeologist. The Archeologist will perform a site inspection, dig test holes and delineate the sensitive areas and their setbacks. Should you desire to dig in those designated areas for any reason, such as new construction, a remodel or landscaping, you must hire an Archeologist to standby and sort through the material while excavation is in process in order to protect any items with historic value. The reports are approximately $2000-$6000 and if excavation is needed in the sensitive areas, the monitoring is on an hourly rate. It can add thousands of dollars to the cost of your project.

Corner Stakes
Do you know what you are buying? Corner stakes can be located or re-staked by local surveyors. Full surveys may be required due to lack of original plat stakes. The cost of a full survey will vary, but for a four-corner parcel it is typically in the range of $2,000-$6,000; setting just replacement stakes can be much less. We have several surveying firms available on the island and I recommend: Andy Holman 360-378-0338, Bob Wilson 360-378-2300, or Bob Anderson 360-378-5072.

Feasibility Consultant
Some purchasers may want to commission a complete Feasibility Study that will respond to not only the existing conditions of a property, but also address the issues, if any, that may have to be satisfied to allow a proposed use of a property. Feasibility Studies can be one-stop reports; addressing conditions of the structures, septic and water questions. . Further, a report on relevant land use codes that may impact the proposed use of the property can also be processed; i.e., a Vacation Rental Permit or Conditional Use Permit. I have a list of consultants so contact me if you need one. The reports are in the range of $300-$5,000 subject to complexity.

Flood and Homeowners Insurance
If you are purchasing on the waterfront, chances are the Flood Zone Determination report will indicate that flood insurance is required. Not all properties need Flood insurance as the improvements are located above the Base Flood Elevation. I have a list of surveyors that can process a Flood Elevation Certificate which is required in order to obtain flood insurance and is also the information necessary to process a Letter of Map Amendment (LOMA) - Waiver of flood insurance.
Be sure to arrange for your standard homeowners insurance policy in the beginning of the process, don’t wait until you are only a few days from closing as the process can take 7-10 days.

Internet and Cell Phone
The majority of the islanders use Century Link or our local firm, Rock Island for their DSL internet connection. Rock Island is currently installing Fiber on all of the major roadways and numerous plats have arranged for their neighborhood installation. We still have a long way to go before fiber connectivity is throughout the islands. Some property owners have found LTE as an option subject to their location to the nearest tower. In some areas with DSL, there isn’t enough strength to stream movies from the Internet but Net Flick delivers. You should confirm that the service to the property you are considering meets your requirements. You can download a free app called Speed Test and run it while on the property you are viewing.

The best cell service providers in the islands are Verizon and T-Mobile. Some remote locations in the islands do not have cell service. T-Mobile has been installing towers in the County so cell service will be improving under their account.

Rock Island can be reached at 360-378-5884. I can’t say enough about how great their service and sales departments are, I highly recommend them.

Was the home constructed under a permit and does it have a final certificate of occupancy? Was the home built under the “built by Owner” permit application and require a safety inspection prior to closing? You should obtain copies of the permits from the County Permit Center to confirm the permit status.
If the home was build prior to 1976 no permit may exist which was at no fault of the owner. Our Permit Department was not formed until the middle of the 1970s. These homes are considered grandfathered-in and non-conforming.

If you are contemplating new construction or a remodel, the current building codes and comprehensive plan can be accessed through the San Juan County web page at ( You can request a permit package or review the County's building requirements through their website which is located at (

If you are buying unimproved property then you should confirm the distance from power to the proposed building site. OPALCO will provide you with the distance and you can obtain a bid from a local contractor for the installation. Installing through rock can be costly.

Seller’s Property Disclosure " Form 17
Pursuant to State statute, all property owners must provide a seller’s disclosure to the buyer. There are some exemptions to the law for Estates or Trustees. The disclosure is not part of the contract and doesn’t provide any representations or warranties. Buyers should share it with the Home Inspector so they may focus on any issues that the seller has disclosed. Ultimately, it is up to the buyer to process their due diligence and confirm if the property is suitable and the condition is acceptable. Buyers should not rely on the seller’s disclosures other than for informational purposes.

Septic System
For existing systems, it is prudent to obtain a copy of the "as built" filed with the County. This will indicate the number of bedrooms the system was installed for and its approximate location, which is helpful for future improvements or repairs. If you are purchasing an unimproved parcel, you should obtain a perc test, design and permit approved by the County. The permits have a validity period of four years and the cost is around $1,250 or $1750 if an excavator is needed. The two most commonly used designers are Jack Cory 360-378-4900 and Rick Petro 360-376-2762.

Septic Inspection
Per the Purchase and Sale contracts used on San Juan Island, the seller must comply with San Juan County Codes related to on-site Sewage Disposal systems (OSS). Seller is required to have the system inspected; pumped if needed, and install all maintenance components required by the code. Typically, all costs for inspection, pump, and installation of maintenance components shall be the responsibility of the seller. Sellers typically pay $200 for the inspection, $800-1000 to pump and maintenance components can run $300-$3,000. Generally, systems installed after 2000 are in compliance with maintenance components. I recommend Craig Starr 360-378-8060 or Ted at San Juan Septic 360-378-7255.

Setbacks and Buffers
You should review the Critical Areas Ordinance located on the County website. This ordinance was effective March 31, 2014 and implemented numerous setbacks that are actually restrictive “buffer areas” from wetlands, shorelines, and streams.

Storm Water Management Plans
As part of the permit process, you must create plan for during construction Storm Water Pollution Prevention which meets County requirements. Further, once the home is built, you must have on-going Storm Water Site Plan to address run off from the hard surfaces and the improvements. This process can be character building.

Structural, Pest and Dry Rot Inspections
It is highly recommended that all buyers obtain an inspection of the home prior to closing. The inspector physically examines all of the major components of the improvements and reports on their condition and recommends any repairs. For additional information regarding inspections and their benefits, you can contact one of our inspectors. The most commonly used are Tim Hance 360-298-1163 or Jon Quigley 360-298-8896. The Home inspection fees are in the range $550-$650 subject to number of outbuildings.

Title Report
Shortly after the seller accepts your offer, you will receive a Preliminary Title report. It is imperative that you review that report for accuracy and question anything that is different from what was represented to you. You should review easements and encroachments directly with the Title Officer that examined the title and issued the report. The reports are complex and only the issuing source is reliable to explain them.

Transaction Closing Process
Due to the number of remote purchasers and sellers, the majority of our closings are handled through email or the express mail systems. We have local escrow firms and title insurers. We regularly cooperate with off island escrow firms, lenders, and 1031 facilitators.

Water Source " Private Well or a Community System
Private and two party shared wells should be tested for bacteria and a San Juan Short list is recommended to test organic elements. The quantity should also be confirmed. The cost for a bacteria and organic test will be approximately $300 including the sampling.

Class A and B systems are community systems in which the quality and quantity are monitored on a regular basis as required by the County. These need not be tested, but their current “standing” should be confirmed through the County.

For more information regarding wells and water systems, you can contact one of the two commonly used well service providers: Martel 360-378-2842 or Al Mauldin 360-378-6975. San Juan County Health Department can be reached at 360-378-4474. The County confirms that community wells are in “good standing” via email which is defined as current with satisfactory Bacteria and Nitrate reports and County inspections.

Wet Lands
You need to determine if the property you are purchasing contains any form of wetlands. Pursuant to the Critical Area Ordinance update, all wetlands have some sort of buffer that must be respected. There is no sure way to confirm the land contains wetlands without a professional wetlands expert.

You can start by viewing the County’s wetland maps and note if the property is located within a designated area with possible wetlands, but that is not a formal confirmation and not reliable. If you are suspect, you can request a site inspection from the County or hire a wetland expert. Once you determine that you have wetlands on your property and they are close to your proposed building site, you need to have the area delineated and the wetlands typed and surveyed so that the required buffers, based on type, can be honored. The fee range for the survey and delineation is $1,000-$7,000 subject to terrain and site difficulty. I recommend Scott Rozenbaum from Rosewood Environmental 360-468-4448 as a wetland expert.

This article is for informational purposes and not meant to encompass the entire process. Hopefully the article doesn’t make the purchase process sound intimidating but if you select me as your agent then I will guide you through the rest of the steps and issues.

Tiny Home, Park Model RV, Trailer, Recreational Vehicle. What is it?


IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson

If you have been watching HGTV recently, you have been exposed to the latest craze of the Tiny Homes.

As an agent I have received numerous inquiries about how San Juan County will regulate this new industry. I have processed some research which I have shared below:


If you purchase a Tiny Home mounted on or as part of a trailer and the wheels, tongue and vehicle license remains intact, at the present time, this is considered a Recreational Vehicle (RV). The San Juan County code defines an RV under 18.20:

“Recreational vehicle (RV)” means a vehicle designed primarily for recreational camping or travel use that has its own motive power or is mounted on or towed by another vehicle, including travel trailers, fifth-wheel trailers, folding camping trailers, truck campers, and motor homes (RCW 43.22.335).
“Recreational vehicle park” means a commercially developed tract of land on which two or more recreational vehicle sites are established as the principal use of the land.

Back to the simple answer of “no”. You can park your Tiny Home on your property as it is considered an RV but you may only have one parked as two or more are considered a Recreation Vehicle Park which requires permits and applicable zoning.

The County doesn’t have any occupancy regulations attached to their RV definition so it is silent as to whether the RV on site can be used just for recreational camping, or nightly or long term occupancy. However, many plats have Covenants, Conditions and Restrictions that indicate the RV or Trailer may only be on site during the course of construction or only on site for a certain number of months at a time.

Although some Tiny Homes have composting toilets, the County would prefer that the RV units be hooked up to a septic system. The owner must confirm that the existing system is large enough for the connection as the Tiny Home is considered as a one bedroom addition. Grey water systems are not allowed in the State of Washington so connecting to a septic system is the best solution.

There is a recommendation submitted to our County by the Building Advisory Council (BAC) to create a definition for this type of improvement versus using the RV definition. The recommendation has not been adopted however, in December of 2016, the International Residential Code issued an Appendix to address codes for Tiny Homes.

Having States and Counties acknowledge that the Tiny Home is a housing source for our citizens will expedite the local efforts to provide regulations. These homes need to be safely built for occupancy, be able to be sold, resold, financed and insured. We need the guidelines as soon as possible.


The County will respond to a complaint but they don’t have the system in place nor staff to enforce the general regulations regarding vehicle parking on private property. As a REALTOR, I have noted numerous properties that have a high number of vehicles parked accompanied by various treasures, a few Costco tents and the infamous blue tarps, but I have always felt that situation is none of my business. Further the County does not respond to anonymous complaints.


If the home is not installed on a foundation it is considered personal property therefore no conforming real estate loan would be obtainable. It may be possible to obtain a consumer loan which is similar to the terms of a vehicle loan. On the various websites I did note that some of the service providers offer financing for their homes but not the land acquisition; that would need to be a separate land loan. Land loans are typically short term and have higher interest rates as the banks suffered numerous losses during the financial crisis in their land loan portfolios.

If the home is installed on a foundation and compliant with the County permitting and life safety inspections, then a portfolio real estate loan may be applicable. A conforming loan will be difficult due to the size of the home and the fact that the ratio of land value to home value will not be in line with lending guidelines. Conforming loans are defined as loans that may be sold into the secondary market such as to FNMA or FHMLC. They have preferred terms. Portfolio loans are held by the bank and not sold.


The County will require that the owner supply evidence that the home was constructed to one of the various codes, whether it be International Residential Code which applies to stick-built homes or Housing Urban Development and Labor and Industries which applies to mobile and manufactured homes. Once the County has evidence, they will issue the permits necessary to allow construction of the Tiny Home on a foundation. The vehicle licensing title would then be eliminated and the home would be considered real property.

Beware; many plats have an architectural control committee and minimum home size restrictions which may prohibit the Tiny Homes.
Other rules and regulations such as density, health and safety would apply in the permitting process and once the Tiny Home is installed on a foundation and considered real property.


If there is an existing home on the parcel and the site is zoned single family, the Tiny Home installation on a foundation must comply with the Accessory Dwelling Unit (ADU) regulations. Generally those requirements include that the parcel is at least 5 acres and the ADU must be located within100 feet of the main house, be less than 1,000 square feet, be connected to the existing septic and water systems and use the same driveway.

If the property is vacant land, you may install up to two Tiny Homes on foundations; one would be considered the main dwelling and the second as the ADU. Again, 5 acres or greater and the ADU must be located within 100 feet of the main house with utility hook ups.

In addition to a main home and an ADU, a 5 acre parcel may be eligible to have one RV although many plats have Covenants, Conditions and Restrictions that prohibit the RV long term parking.

Further, guidelines apply regarding the rental of the real property structures. If you have a main house and ADU, only one may be rented nightly subject to a vacation rental permit. The other structure must be occupied by a tenant on at least a month-to-month or by the owner. You may not rent out the main and guest house on a nightly basis unless they are rented to the same party simultaneously.


The attraction to the tiny Home versus a trailer such as an Airstream is the quality of construction and life expectancy. The Tiny Homes are stick-built on their trailers or skids. In most cases their plumbing, electrical, insulation and interior finishes are similar to a stick-built home but they are not always built to the code of a stick-built home.

Most trailers, tiny homes and RVs are built to comply with vehicle licensing safety standards set forth by American National Standard Institute 119.5 as well as NFPA 1192. These regulations focus on health and safety and the designation also aids in obtaining insurance and financing.

In some cases, it is unclear to what building code these Tiny Homes are being built to. The buyers of these homes need to be aware and must assume the responsibility that “during the course of construction” inspections may not have been made by any governmental agency.

Many firms offer Tiny Home Kits that assist you in the construction of your own home which in my opinion is further evidence of no formal standards. To someone that has been in the real estate and construction industries since 1978, the check lists offered by the service providers on the various websites are frightening to read. At least under the electrical portion of the check list, they highly recommended the use of a professional. As many Counties have yet to address building codes for these homes, it feels a little lawless out there.

Our County is currently working with the Building Advisory Council (BAC) in order to provide future clarification and guidelines for Tiny Homes and ADUs. The Council has recommended that the County develop a program similar to the Owner Builder Program. This would allow the homes to be permitted and constructed by the owner with only a Life and Safety inspection at completion. Under the owner builder program, a home must be permitted and comply with land use, the energy code, have compliant stairways, and adequate ingress and egress windows with safety glass.

In addition, there is a group that is forming a library of plans that have already been permitted and gone through the process at the County which should fast track the next application when those plans are used. It should also reduce the fees associated.

There may also be a few groups hoping to utilize the Tiny Homes under one of the affordable home programs that are offered in the County. This program may be similar to the self-help housing programs. I don’t know if a density variance will be granted under this program as it is too early in the process.


As the County is restrictive to the construction of guest homes, the Tiny Home will be a good alternative to accommodate friends and family. A review of the regulations around our guest houses may need to be revisited again. In our remote location where guests and family stay a while, guest homes are very popular. Many years back, due to fears of double density, we imposed various restrictions in hopes of stopping or reducing the guest house construction but some of these rules are being bypassed or ignored. As a REALTOR, I see many outbuildings that are very similar to a guest house, but just not permitted as one.

As rentals, ADUs offer affordable housing for many of our citizens which should outweigh the concerns over double density. Before I launch further, the ADU regulations are an entire topic on their own. Hopefully it will be addressed in 2018 under the affordable housing compliance for the County.


Per State statute, the Assessor may consider the Tiny Home or Park Model RV as real estate and assign a value to the improvements for assessment purposes once the unit is hooked up to utilities such as water, septic and power. Over the years, I have noted many Park Model RVs on properties with their wheels in place, but when you review their assessment information, they are assigned a land and improvement value. It used to puzzle me, but now I know.

As you may be aware, our Assessor only makes a physical site visit every 6 years, however; the properties are reassessed annually. It may take a while for the Tiny Homes that have been connected to utilities to be designated as improvements on the tax rolls.


The popularity of the Tiny Home is present but it may take a few regulation updates in order for them to become prevalent in our neighborhoods.
If you desire more information about Tiny Homes in San Juan County, you may want to attend the classes that are offered at Skagit Valley Community College at the campus on San Juan Island instructed by Richard Russel, a general contractor on Orcas.

Several Tiny Home businesses are in the start-up phase on San Juan Island. One local firm is owned and operated by Charli Schmidt. She is currently under construction on a home and has future expansion plans. Her website is and she can be reached at 360-317-4184.

As always, this article is intended for informational purposes and not intended to encompass all of the rules or regulations about the topic. As always, I am too wordy and if you made it through this article, I thank you.



IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson

Unlike liquor, your water source in San Juan County is not guaranteed and must be acquired and cared for.

When you first consider purchasing an unimproved parcel of land you should condition your purchase upon a satisfactory water source. The days of clients purchasing land without the water source determined are long gone. Further, if one hopes to use institutional financing, the lender will require that the water source be acceptable in quality and quantity. Lenders will also require a valid septic system permit and access to an electrical power provider.

The majority of non-platted parcels in the San Juan Islands are serviced by individual wells. Most subdivisions offer access to a community water system, and some urban areas offer public systems.

Types of water sources in the islands include:

• Individual Private wells

• Shared well; 2 users. These systems should have a recorded shared well agreement with easements for maintenance and access. Depending on the volume, individual holding tanks may be required.

• Group B water system; 3-14 users. In the late 1990s, the County began managing the approval process for this group of water system. The County requires that the system have a maintenance agreement, access easements, a protection zone and regular testing with an assigned purveyor. The County requests the purveyor to submit a bacteria and nitrate tests annually to remain in “good standing”. Prior to late 1990s, these were unregulated systems and some of the older systems have yet to be brought up to proper standards. Hence, the importance of confirming with the County that the system is in “good standing”. These systems typically have a base monthly charge plus a fee based on your use and surcharge for heavy use.

• Group A water system; 15 plus users. These systems are larger providers such as Roche Harbor Water or the Town of Friday Harbor. The system’s reports are reviewed by the State and must comply with the State’s requirements for maintenance, testing and notifications. The hook-up fee in the town of Friday Harbor is currently $11,392 and the fee for Roche Harbor Water is $9,600. These hook-up fees do not include the installation cost for connection to the main sewer lines or storm water management systems. Again, these systems have a base monthly charge plus a use fee.

Drilling a New Well

If purchaser is considering buying unimproved land, it is prudent to ask for the seller to drill the well, in a mutually agreed upon location, at seller’s expense. Depending on the purchase contract, if the well is satisfactory to the purchaser, the seller may be reimbursed for all, part or none of the well drilling expense.

Well drilling runs about $15.50 - $20.00 per foot and the average depth of wells on the island is approximately 350 feet. Once you add the pump, pressure tank, water lines, power, holding tank, filters, and a modest well house, etc., the check is written in the range of $20,000-$25,000.

If the proposed well site is within 1000 feet of the shoreline, an entire list of regulations must be complied with which will add to the cost of your well installation. If the proposed site is within 50 feet of a lot line or public road, variances may be required from the neighboring properties.

Quality and Quantity Testing

A purchase contract should also contain a provision for satisfactory quality and quantity testing. Those tests include a bacteria test for $100 and a San Juan Short test for $200. The County requires a satisfactory San Juan Short list prior to the issuance of a building permit so it has become the standard test for new and existing wells.

The San Juan Short is inorganic testing for arsenic, barium, fluorides, sodium, electric conductivity, chloride and nitrates. Both of these tests must be sent to laboratories for analysis. The San Juan Short takes up to 21 days.

The laboratory reports provide you with a notation regarding the actual levels for each of the 7 contaminants and whether they pass or fail is based on meeting acceptable levels set by State or EPA. As a REALTOR, I have personally been involved in several transactions on San Juan that failed the tests; several with barium and one with arsenic.

The good news is with today’s technology, there are filter systems that can address the majority of the water contaminants. Just add more money to your budget and most problems can be fixed. Hard, soft and even “stinky” water can be remedied with various treatment systems. Salt water intrusion on the waterfront properties, remains as one of the most difficult problems to resolve.

We recommend the two firms listed below for drilling, water testing, and they also provide purveyor services for community systems. Mauldin’s Well Service 360-378-6975.and Martel’s Well Drilling 360-378-2842.

When the well is drilled, a well log will be generated that indicates the well depth and an air test that will indicate the quantity. This typically satisfies a buyer for evidence of quantity.

Well Production

The County has a minimum quantity requirement in order to issue a building permit. Individual wells must produce at least 200 gallons per day. A shared well and a Group B system must produce 800 gallons per day per hook up.

The Town of Friday Harbor indicates that the typical household (4 persons) uses an average of 133 gallons per day. The National consumption average is 100-150 gallons per day. The requirement of 200 gallons per day for an individual well is a form of protection to buffer water use and not stress the wells.

Well Fracturing may increase production rates but it can also pose a risk to surrounding wells in the area. Well interference from drilling a new well or fracturing can be a problem and the rule that applies is “first in time " first in right”. In the event a well interferes with a prior neighboring well, the property owner of the well that interferes must take precautions to insure that the first well has the quantity they had prior to the second well being drilled. Those precautions could include pump depth relocation, holdings tanks, restriction values and off-peak holding tank fills such as during the night time.

Finding a copy of the original well log to confirm quantity is a good approach to evidencing quantity as the alternative is to process a draw down test. This test can place a well at risk if it already had the potential for salt water intrusion. You can find a copy of the original well logs by visiting the Department of Ecology web site per the link below and searching by tax parcel number or well head ID number.

If the well log is not found and the buyer of your home insists on knowing the quantity of the well, which is a reasonable request, a property owner must face the decision of processing a draw down test. Certain times of the year, draw down tests on waterfront property can pose risk of salt water intrusion so it would be appropriate to consult with your favorite well service provider. During a draw down, precautions are taken within the process. Basically the provider would draw the well down using only the top 50 feet of the well. They would use on-site litmus paper to test for chlorides and sodium before, during and after the flow test. They would stop immediately if the chlorides or sodium levels change. They will only process the draw flow until the volume reaches an amount above the minimum quantity requirements for the single or shared well. There is no point in pressuring the well above the County requirements. A drawn down is typically for 2.5 hours.

Other Water Source Options:

Alternative water sources can include a roof catchment system, although lenders frown on them, and the holding tank requirement is very large. Another option is hauling water into a holding tank, but again, financing the home would be a challenge. Costly desalinization water plants are an option for community subdivisions near the waterfront. Rumor has it, if you are using water from a D-sal plant, be sure to take your multi-vitamins as the process strips the water of elements we all need in our systems.


Permits are required and the well driller must coordinate with the septic designer to allow for adequate setbacks from each system. If you fell in love with a challenging lot and you have to factor in setbacks from the waterfront, Indian midden or wetlands into the equation, the entire process will become “character” building and more expensive than ever. The base Archeology study starts at $3,000 and wetland delineations start at $2,600 subject to the typing and amount of survey work required. A Residential Pre Application (RPA) which determines your setback from the waterfront starts at $1,000 (including the consultant) and is not binding so if the regulations change, the RPA may no longer be valid.


A homeowner should maintain their water systems regularly, similar to how we handle our septic systems. The bacteria tests should be processed annually and a San Juan Short every few years. Periodically, the well systems need to be flushed with a mild bleach solution. The holding tanks need to be monitored for tight seals; bugs can access the tank from the smallest openings. You should have an annual inspection for both the poly and concrete tanks and clean, as needed. Expect to replace a pump about every 10 years and filters as recommended by the manufacturer.


If you are purchasing an existing home, the water system should be tested or if it is a Group system, the status confirmed to be in “good standing”. A telephone or email to the San Juan County Health department will provide you with the “good standing” confirmation or lack of. The County also has a website with the status of all group systems.

Again a Bacteria and a San Juan Short are the tests of choice for new or existing private and shared wells. A well log is preferred over a draw down test.

Water throughout the world is a precious commodity. It must be used wisely and maintained properly. Humans can’t survive on liquor alone.

This article is for informational purposes only and not intended to be all inclusive of everything you should know about water systems in San Juan County.

Docks, Fun Facts to Know and Tell


IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson

During the real estate boom years of 2005 through 2007, waterfront homes on San Juan Island appreciated around 8-10% per year and homes with docks appreciated around 13%. Docks have always been a coveted property amenity as they truly allow easy access to boating; the reason many want to live on an island.

Many, many years ago, docks were easy to obtain and were often used for making a living such as fishing, crabbing, commercial boat use and marinas. In today’s environment, docks are very difficult to obtain. The last few residential docks that were constructed were shared and took 2+ years with most of the delays within the Corps of Engineer’s various departments. Total costs for the legal fees, hard and other soft costs were in the range of $200,000-$400,000. Reportedly, the legal fees were in the range of 25%-40% of the total but this varied based on the amount of opposition and delays.

Even if you have the funding, there is no guarantee that your dock application will be approved. It is possible, but you must have a strong desire, be stress resistant and have deep pockets.

I pretty much tell my clients that processing a dock permit is a difficult option; they need to buy a home or lot with an existing dock, if having one is in their criteria. Further, considering one of the public marina facilities is another solid solution.

The property owners on the non-ferry serviced islands without community moorage have a less difficult time obtaining permits as the County can’t argue they have a feasible alternative, however, they may view a mooring buoy as an alternative. The process for an outer island dock is the same and their cost of construction is similar but their attorney’s fees may be less due to less opposition.

We have many different sizes and types of docks in the islands as all are custom-built. The older docks are mostly wood with creosote pilings. Newer docks include grated plastic material on the piers, floats and aluminum ramps to let in the light. The pilings are all concrete/metal. These new docks are all environmentally friendly based on current technology.

Docks that were installed prior to the creation of our permitting department in the mid 1970 (s) are considered grand-fathered-in and permitted repairs can be made. Any structure repairs such as piling and float replacement must be permitted. Smaller repairs such as replacing a few boards also requires a permit.

Under the Shoreline Management Program, if you are replacing
33% or more of the structure, or 200 square feet, it is necessary to bring the replacement section of the structure up to current code; i.e. g. using functional grated materials.

Over the years there has been concern over the “porcupine” effect of docks on our shoreline; we didn’t want to become Lake Washington. As per the assessor’s records, we currently have 460 piers in the County, located on our 2,489,800 lineal feet of shoreline. Other than manually counting, I was unable to determine how many of the 460 piers are public or marina facilities, such as Roche Harbor, Port of Friday Harbor and other County piers. The assessor conducted their survey by counting the piers; not floats ramps or slips.

The majority of the private, shared or community docks are located in the protected bays, however; there are some seasonal docks in the channels. The seasonal docks have their floats removed during the winter season and their ramps elevated to protect them from the winter storms.

It was estimated that 10% percent of the total are deep water docks. In the real estate industry and at the assessor’s office, we consider 6 feet at zero tide to be a deep water dock; and that typically can handle most power and sail boats, except at the minus tides that we have during the year in the summer. During those tides, some owners must move their boat to a mooring buoy located in deeper water, or go to Roche Harbor for lunch during the tide change.

The rest of the docks vary in depth and many go dry during the low tides. It is common practice with those docks to just trim up the motors and let the boat nestle in the mud. You fish around the tides anyway, so the impact to the owner isn’t a major event.

When the tax assessor’s office revised how they valued docks from cost approach to market approach, they measured the approximate depths and recorded the information in the County assessment records. Now they have a sophisticated formula to assign market value to each dock based on size and type of materials used. In my opinion they are still behind market value, but I am confident that anyone undervalued, will report themselves to the assessor’s office.

If you are buying or listing property and need to know the dock depth, you can now contact the assessor’s office for that information.

The County assessor website records also reflect the size of your piers, ramps and floats. Further, I have been told that the Friends of the San Juans also recorded dock sizes throughout the County to aid in monitoring changes made without permits.

As an agent, when we value a dock for marketing purposes, we consider the amount of listings with docks currently on the market and formulate that into the equation. Further we know that it is extremely difficult to obtain a dock, so the existing docks are very valuable, even if they are in poor condition. I typically assign a value of $300,000 to a private dock with pilings, even if it has deferred maintenance. If it is in good condition and has a boat house, the value goes up. If it is shared, the value is divided by the number of users.

If the dock lacks pilings and has just an anchorage system, it is of less value.

If the property is assigned a slip on a shared dock, I value that similar to one of the condominium boat slips at the Cannery or Warbass; about $1250 per foot in length, subject to market conditions and the location of the slip. This is based on the average price per foot of the last few slip sales.

If the property has a community moorage such as Brown Island or Cape San Juan, additional value is assigned as well.

Currently there are waiting lines at many of the resort marina facilities as boating is truly a popular past time of islanders.

Mooring buoys are a good alternative although it can be difficult to make the transition from your dingy to the larger boat on the buoy. Age and flexibility must factor into the process for some of the boat owners. The County favors buoys over anchorage due to the lack of destruction to aquatic vegetation from pulling the anchor.

You can install a registered mooring buoy for around $1500-$2000 that meets the Corps of Engineers and County standards. New registered buoys must be in 16 feet of water.

Another viable option, when the beach is suitable, is installing permitted beach access stairs with a platform to store your dingy or kayak. As long as the platform is above the ordinary high water, this structure is not considered a dock. Beach stairs are also more favorable to the environment as they consolidate the people traffic on the stairs versus having numerous trails down the beach that can contribute to erosion.

Docks will always be in demand and will elevate the price of homes that already have them by at least the cost to install one, if not more. In years past, I only assigned $100,000 to the value of a dock but times have changed.

I am one of the fortunate property owners that have a dock; of course it is shared and my fees to attorney Stephanie O’Day were only $6000 and the cost to construct was only $30,000. This was in 1992, so a lot of changes have happened in the last 25 years.

We have attorneys and consultants in our County that have been successful in processing dock permits and those individuals are referenced below.

I have noted that the Canadian Geese deem the eel grass one of their favorite foods and are a cause of depletion. In reviewing dock applications, that information isn’t recognized in the process of whether a dock should be approved. It makes sense that docks are viewed as the source of harm to the environment not nature as the government can do something about the docks but not nature. The regulations have functioned as designed; the consequences, whether intended or not, have made docks cost more, take longer and are more difficult to obtain.

Mooring Buoy Installer:
Chris Betcher 360-376-4664
Stephanie O’Day 360-378-6278
Dock repair and installation:
A-1 Marine 360-472-0701
Waterfront Construction 206"548"9800
Jack Cory 360-378-4900
Francine Shaw 360-378-6278

Flood Insurance in the San Juans


IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson

Most of the waterfront home owners in the County went through the process of determining if flood insurance is a necessity for their property when they purchased or refinanced. As you may be aware, the majority of our waterfront properties are designated as being in the flood plain as determined by the current Federal Emergency Management Agency (FEMA) maps. What you may not realize is that a high percentage of the homes and other structures, when further analysis is done, may not actually require flood insurance.

When purchasing a waterfront property, whether you are using a lender or not, the first step in determining whether you need the insurance is to obtain the Flood Determination Certificate. The lender will process one as part of the loan package but if you are a cash buyer, you may utilize one of the numerous services on the web for a nominal fee of $25.00. Other options include viewing the property with the flood plain map overlay on the County site. If the determination indicates the property is in a flood plain, you will want to hire a surveyor to confirm the Base Flood Elevation (BFE) for your property. The process typically takes 10 days after a site assessment is complete and the application has been submitted to FEMA. The insurance underwriters will require a BFE in order to issue coverage and if you are using a lender, they won’t close until you have a policy in effect.

As a result of the passage of the Biggert-Waters Act in October 2013, flood insurance rates through the National Flood Insurance Program have been increasing. Further, FEMA is no longer subsidizing the rates due to large loses throughout the nation due to hurricanes and other similar events. Due to increasing premiums, it will be more important than ever to determine whether your property should have flood insurance.

The Base Flood Elevation (BFE) from the surveyor is also a key part of determining whether insurance is necessary. Once the BFE is obtained, the surveyor will then survey the property and determine the elevation of the lowest grade adjacent to the structure(s). This will confirm if the structures on the property should be insured or may be eligible to be removed from the flood zone. If the structures remain in the flood plain and you are using a lender, you must obtain flood insurance.

If you are a cash buyer, it is a personal decision. One might want to review the forecasted Tsunami path for the County to determine if your property could be flooded and verify with your insurance agent that your policy would cover such a disaster. Chances are flood insurance will not cover global warming and sea level rise until, and if, they actually occur, and then the government would need to mandate the coverage.

As in the case of your standard Hazard Homeowners Insurance, only the structures are insured, not the dirt.

FEMA recently contracted with the Corps of Engineers (Corps) to complete the mapping and determine the Base Flood Elevations (BFE) for our County. FEMA then adopted those maps for regulating the insurance. The Base Flood Elevation for most of the County is 12 to 16 feet. Generally speaking if your property has a BFE of 13 feet or greater, you may be eligible to obtain a Letter of Map Amendment (LOMA) which allows you to waive your flood insurance. Below 13 feet, the LOMA may be more difficult.

Bottom line, if you have waterfront property, it is most likely designated as being in the flood zone by FEMA unless proven otherwise by a Professional Land Surveyor. The recent updates to the maps have further enhanced the consumer protection.

To view the REVISED flood maps and the BFE in your general neighborhood you can use the link below:,48.4124,-122.5627,48.7214

If the structures as surveyed are above the flood plain, then the improvements and a portion of the parcel may be eligible for a Letter of Map Amendment (LOMA). To obtain a LOMA, you should hire the surveyor again, as they process these on a regular basis and are familiar with the zillion forms required by FEMA. The surveyor will submit the application for a LOMA to FEMA and the process is 2+/- weeks. The total cost is approximately $2,200-2,500.

I believe this to be money well spent as the $2,500 represents about 50% of the annual flood insurance premiums on a typical San Juan County waterfront home. The time frames to complete a BFE and a LOMA are within the standard purchase contract term of 45 days; however it is recommended that a prospective seller process this information in advance of listing the property. If you are working under a tight time frame, another option for a buyer is to close on the purchase with your loan and flood insurance; then, obtain the LOMA after closing.

If you currently own waterfront property and are paying for flood insurance, it may be beneficial for you to move forward with the possible LOMA so that you can avoid paying premiums. It will also help expedite the sale of your property in the future as the LOMA runs with the land and can be used by a buyer.

Once you secure the LOMA, you will need to send that into your lender’s loan servicing department which may take a few more weeks. They will issue you a Waiver of Flood Insurance Notice which is your invitation to cancel your flood insurance. The insurance firm should prorate back your premiums for any unused term.

This article is for informational purposes only. As each property has unique characteristics, property owners should check with their licensed flood insurance agent to determine their options and the best solution regarding their flood insurance.

We have numerous surveyors in the County that process the applications for Base Flood Elevations and Letter of Maps Amendments, I recommend the following:

Bob Wilson " San Juan Surveying 378-2300
Andy Holman " Holman Land Surveying 378-0338
Bob Anderson " Star Surveying 378-5072

If you have any questions about our current real estate market, please be sure to contact me.



IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

written by Merri Ann Simonson

The definition of “market value” is rather boring sounding when you take into consideration that you are addressing one of the highest value assets that a property owner may have or the most expensive item that a buyer may purchase in their lifetime.

Emotions run high when it comes to the selling and buying of real estate. If we all could just buy low and sell high, life would be so much more rewarding.
Definition: Market Value is the price a property is most likely to command in a competitive and open market, with a willing buyer and a willing seller in an arms-length transaction, wherein the parties have each acted knowledgeable, prudently, and without compulsion and in their own best interest.

A Competitive Market Analysis (“CMA”) is an opinion of value produced by a real estate professional. Upon request, a real estate agent will process a CMA for the purpose of assisting a property owner with the valuation of their property when they are considering selling. A CMA may also be processed as a service for a buyer who is considering making an offer to purchase real estate.

The real estate agent will evaluate the property by reviewing all recent property sales and determining what a typical sized property is selling for given such factors as square footage, number of bedrooms, amount of land, size of view, waterfront, etc. Our islands can make this process a challenge as most of our properties were improved as owner designed construction and built very custom; finding similar properties can be difficult.

In addition to reviewing recent sales, adjustment factors may need to be applied such as current and predicted market demand, the appreciation or depreciation calculations, the cost approach based on present value of each component, the amount of comparable properties currently available, and the subject property’s special features.

Comparison against current unsold inventory is something an agent can consider but an appraiser is unable to heavily consider in the process of formulating an opinion of value. This restriction on the appraisers insures that their approach to value is more conservative but may hinder their ability to report that the market is in transition. They are licensed to value here and now, not the market right around the corner; good or bad.

Completing the CMA allows the real estate agent to develop an opinion of the value. This is part science and part art; it requires experience and boots on the ground.

Consumers should be cautious when using on-line home value estimators as they do not function very well in San Juan County. These sites rely upon the various County Assessor’s information and valuations to process their own calculation. The on-line estimators do not have representatives that physically inspect and evaluate the property nor do they have local market knowledge.

The assessor’s office performs appraisals for the purposes of ad valorem taxation. This is part of the process for how we provide funding to all local government services. The assessor’s appraisers only have access to the exterior of the improvements. They also use a “blanket” approach with comparable sales from the immediate neighborhoods, district or regions versus singular. The assessor’s values assigned are for their tax purposes and are not used for lending or listing property for sale.

The website value estimators may be more reliable in Metropolitan areas where subdivisions of very similar homes are bought and sold on a regular basis. The website value estimators have historically performed poorly in small, low volume, custom construction markets such as San Juan County.

Due to the popularity of real estate websites with estimators, agents spend a lot of time explaining to buying clients why the values presented not reliable in our area. Below is the accuracy table as of August 2017 for San Juan County with a 2 star rating or a fair estimate. King County also has a 2 star. Our 2 star rating has not improved since 2014 when I first reviewed the chart.

chart (67k image)

Agents are not licensed appraisers and there is no regulation surrounding how they calculate a property’s value; there is not a uniform calculation. However, it is an agent’s duty as contained in the REALTOR Code of Ethics, to process an honest opinion and not to mislead the owner as to the market value of a property.

Further, requests for valuations for legal purposes such as divorce, estate planning, trust work, etc., are referred to local appraisers. A CMA is not an appraisal as defined in chapter 18.140 RCW but is prepared by a real estate licensee who is not state certified or licensed as a real estate appraiser.

We have three active appraisers in our area. I recommend Mike Paredes 360-378-5474, Mike Aikens 360-424-0331 and Sheila Bienenstock 206-915-5537.

If you are seeking an appraisal for loan application purposes, then the lender is the one that selects which appraiser to use as the report is for their benefit.

If you have any questions regarding our real estate market or the valuation process, please be sure to contact me.

San Juan County Waterfront Parcels


MAS (70k image)

written by Merri Ann Simonson

If you own a waterfront parcel in the County, or hope to purchase one, I have detailed below some items to take into consideration. Historically, waterfront parcels were the most coveted investment in the islands but due to ever changing regulations, they are now the most confusing parcels to develop. For REALTORs they can be a challenge to sell due to our inability to give buyers concrete answers to their questions while on site.

Important Considerations:

Once you purchase a waterfront lot it is prudent to move forward with your plans as soon as possible as the regulations in the future may change and what you had hoped to build at the time of acquisition may not be approved in the future. The County has said they will never render a parcel unbuildable but regulations may restrict the size of residence and dictate the location of where you can build on the lot.

Residential Pre Application (RPA)
This is a conceptual approval of the footprint for the residence under the rules that exist at the time of review. While the RPA report is non-binding on the County, constructive reliance can be used for planning your new home including the home site, setback, tree removal, the location for the driveway, and well and septic, if applicable. This is a valuable tool to utilize upfront so that your design team and contractor have solid direction from the County early on in the process.

Your designer or architect may process the RPA for you as part of their service. If not, you can hire a land use consultant. The cost to process an RPA with a land use consultant is around $900-$1400 which includes County fees.

As an RPA is not binding, and in light of proposed regulation changes, one should only be used for near term planning. Currently the Shoreline Master Program is being updated and the likely 2017 implementation may change shoreline regulations, possibly voiding some conclusions from an existing RPA. In order to bind or vest your project under the current rules, a complete permit application must be submitted to the County. Once the application is deemed complete that becomes the effective date prescribing which version of the regulations applies.

Shoreline Setbacks
This is a difficult topic to address. The Critical Areas Ordinance (CAO) was approved in 2013 and significantly altered the setback regulations by placing the majority of the shorelines in the County into a Critical Areas designation. Basically a very simplistic definition of the current setback regulation impact includes there being a “no touch zone” in the first 35 feet from the shoreline, although a 5 foot trail to the beach is permitted. Only dead, dying and dangerous trees may be removed in the area located behind the first 35 feet to a total of 110 feet from the shoreline. It is possible to brush and clear for view and fire protection in the 110 foot zone and it may be possible to build between 110 and 75 feet if you have a forester design and the clearing planned will have a minimal impact to healthy trees.

In addition to the CAO regulations impacting shoreline properties, the Shoreline Master Program, as mentioned above, is currently being reviewed for adoption and could place further restrictions on shoreline development. The Shoreline Master Program dictates land use within 200 feet of the shoreline. While some key elements of these regulations are under legal challenge, they remain binding and in effect. Under the current SMP, setbacks differ from Critical Area setbacks. If you have "adequate" screening, you can build 50 feet back from the top of the bank. If not, you must stay back 100 feet. A screening analysis is an important component of an RPA.

However, because the two sets of rules differ, the law says that the most restrictive rule applies. This means that the home site will most likely be established around 110 feet back from the shoreline. It is also possible to average the 110 foot setback for certain, very specific reasons.
Due to the individual geometry of each lot, the geological conditions at the water’s edge, the adjacent property home sites and the amount of vegetation available for consideration as screening, each setback can vary. One size doesn’t fit all, and given the complex and somewhat subjective nature of shoreline setbacks, we recommend obtaining professional advice to assist in planning your project.
Additional rules regarding house location include the possibility of an unstable bank, which requires a site visit by a coastal geologist or engineer; and the fact that all the salt water is protected "fish habitat", which requires a proposed development impact analysis prepared by a marine biologist.

Property Survey
It is always prudent to have the corner stakes properly identified for any construction project but it may be more important on the waterfront. If you don’t know the lot line measurements, you may design a 65 foot wide home then find out you may only build a 50 foot wide home if the shoreline is only 100 feet wide (you are limited to a 50% lot width coverage). Having a survey will also confirm any encroachments and other issues that you may need to address.

Tree Removal
A tree removal permit is required for any tree removal work done in the shoreline (200 feet from the water’s edge) When tree removal is a necessary part of construction, trees to be removed must be clearly noted in your plans submitted for your building permit. Your plat Covenants, Conditions and Restrictions (CC&Rs) may also have an impact on your tree removal plan. If the plat CC&Rs are more restrictive than the County, they override the County regulations and guide the process.

For shoreline properties with existing development, tree removal may only be done with a standalone tree removal permit. Consultation with a certified arborist is recommended to discuss the condition of your trees and how the shoreline regulations would apply.
A tree removal plan will catalog and locate all trees on the lot and identify those designated for removal. Basically, to retain views, the County does allow 4% trimming per year or 40% over a ten year period. Good luck with figuring out the calculation, you may want to consider hiring an arborist to calculate the 4%.

Building Plans
Having a clear, complete plan set is an essential early step in the process of building your new home. You may select an architect or designer to work with or engage one of the several general contractors on the island who provides design services. The design process should include working with an engineer for the structural elements of the design.

The plan creation process is typically 4-6 weeks or more. The fee range is too wide to quote as it depends on the complexity of the design and whether the service provider stays involved and conducts the inspections during the course of construction.

It is prudent to interview several general contractors and find one who is compatible with you and your goals. A new build or significant remodel can be a lengthy process and it is not always about the pricing, it is important to find a general contractor that you communicate well with. Your REALTOR, architect or designer will have suggestions. Obtaining bids may take another 30-90 days as the contractor will bid out the major components with their subcontractors. On certain types of jobs, contractors will only work for time and materials as the homes are just too complex.

The architect, designer, land use consultant or your contractor can submit to the County for permits. You may submit your plans directly as well. That process is quoted by the County at 10-12 weeks but further time may be needed depending on the complexity of your home design and completeness of your package.

Many factors come into play at the San Juan County building department. The County provides a detailed checklist for each type of permit. While comprehensive, the volume of paperwork and order of operations may be overwhelming to someone unfamiliar with the County’s process. Your file travels through several departments with each reviewing their component and hopefully issuing approvals. The components include, but are not limited to; water source and testing, septic permit, storm water management plan, energy study, engineering, lot lines and corner stake confirmation and possibly an archaeological or geological study.

Archaeological Sensitive Areas
Cultural resources are evidence of past human activities. It is not uncommon for waterfront lots to have items of cultural significance or be located in the buffer zone of an existing identified site. In order to confirm whether the lot you own or are considering purchasing has archaeologic sensitive areas, a property owner must contact San Juan County. Due to preservation and protection of the sites, the maps are not of public record.

Flood Insurance

As you may be aware, the majority of our waterfront properties are designated as being in the flood plain as determined by the current Federal Emergency Management Act (FEMA) maps. What you may not realize is that almost 90% of the homes and other structures, when further analysis is done, do not actually require flood insurance. Contacting a surveyor to process a Base Flood Elevation (BFE) for your property should be on your checklist. The fee charged by the Corps of Engineers is in the range of $105-$350, subject to previous determinations in your immediate area and it typically takes 2-3 weeks. Base Flood Elevation certificates are required in order to obtain flood insurance and are also used to obtain a Letter of Map Amendment (LOMA) which is required to waive flood insurance. Processing a LOMA will be in the range of $2200-$2500.

Again this topic is very custom and will depend on the type of home you plan to build and your building site. I know of some contractors on the island that can build for $175 per foot but that would be for modest construction. I know of some homes that have been built on the island for $1,000 per foot. Your budget needs to be established then monitored with every change order processed.

Site Development Costs
You should budget around $25,000 for a septic system installation and $20,000 for well drilling and associated plumbing with a bit more if you plan on a water storage tank and a well house for all of the equipment.

Utility line trenching will vary due to length and terrain, but typically the excavation costs run $9.50 per foot unless you hit rock then it can be as high as $15.50 per foot. Don’t forget to drop optical fiber in the trench for future use.

For your power, you can contact OPALCO and have them locate the closest transformer to the building site, then provide you the distance that the trench will need to run. This allows you to bid out the secondary power line installation with the local excavators.
Of course it is easier to have your general contractor include the site development costs in their bid or estimate.

I highly recommend hiring professionals at the start of your project, not that our County employees aren’t pleasant to work with and always helpful, but they are often busy or unavailable, plus the regulations can be confusing and consultants work with the County on a regular basis and are more familiar with the procedures. Permit consultants in particular can monitor the entire process leading up to a building permit application, and can also assemble a team of specialists to provide the numerous site specific reports.

Construction Loans
You can obtain a land loan to acquire the lot then once you have your plans, builder, costs and permits, you can apply for a construction loan. It is convenient if the seller will provide financing for you for a short term such as 1-3 years. Seller provided financing can be less expensive than a land loan at a lending institution as the rates are closer to 5-6% and there are no loan fees. Banks had a high level of defaults in their land loan portfolio so they currently charge a premium to fund land loans.

The construction loan can be a combination of construction term that will roll over into a permanent loan. You can set the construction period at 6-12 months with the remaining 29 years being the permanent loan portion. During the construction period of the loan, the bank will make regular inspections and disburse your funds based on a percentage of completion. Once the home is complete and loan fully disbursed, they roll it into the permanent loan terms.

Builder’s Warranty
Many property owners believe that Washington State requires a one-year builder’s warranty on new construction, this is not correct. However, most builders will stand behind their product in order to maintain a good relationship with their client and future referrals.

Other than dealing with the shoreline regulations addressing tree removal, setbacks and a higher likelihood of having an archaeologic area, there is no difference in the process as compared to building on an interior lot.

As the existing home inventory on San Juan is being absorbed, buyers are now determining that building a custom home may be their best option. Their ending product will be exactly what they want and we currently have ample inventory of land for sale at great prices. Waterfront lot sales have been slow over the last few years due to the lack of recovery from the recession and regulation changes; now is a good time to purchase a waterfront lot.

Recommended Professionals:
Casey Baisch 317-5559 Tree removal, Arborist
Jack Cory 378-4900 RPA, Permit Processing, Septic Design, Home Design
John Geniuch 317-6741 - RPA, Tree Removal Plans, Permit Processing, Arborist
Francine Shaw 378-6278 RPA
Bob Quarry RPA, Permit processing

If you need a reference for archaeology, construction lenders or general contractors, please be sure to contact me.

Rental Property Options


IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

San Juan County currently has several mechanisms for legally renting a home in the County.

The information below is meant for informational purposes only, and does not incorporate all of the rules and regulations. It will however provide those who want to learn more about residential renting of homes in the County an overview of at least some of the things they need to consider, and do, prior to listing property for rent.

Long Term Rentals. No permits are required. A long term rental is typically a term lease, but can also be month-to-month. Like short term rentals, professional property management is available and the rates are normally equal to one month’s rent paid at the commencement of the occupancy. If rent, collection and property monitoring is included, then the fee is generally 10% per month.

Vacation Rentals. A vacation rental permit from the County is required. Vacation rentals are allowed in all Land Use Districts except Resource, Conservancy, and Natural. The permit application can be processed by a property owner or by a professional who specializes in land use permits. The range for a Provisional Use Permit, including the consultant is $1,400-$2,800. As long as the property qualifies lawfully, the County will approve the permit, even if a neighbor objects.

If the property is improved with a main home and a guest house, only one of the dwellings may be designated as a vacation rental. If either the main or guest house is a vacation rental, the other dwelling must be owner occupied or rented to a long term tenant. A Guest house may be internal, attached or detached.

Under a vacation rental permit, the tenant rents the use of the entire house -a house is defined as one that includes at least a kitchen, bath and bedroom(s).

Details of all County requirements can be reviewed on line under Section 18.40.270 Vacation (short-term) Rentals of Residences or Accessory Dwelling Units (guest houses) in the San Juan County Code

AIR B&B. Surprise, this requires a B&B (Bed & Breakfast) permit from the County, and they are not allowed in all land use designations. There are two options; B&B Residence which is 1-2 bedrooms or a B&B Inn which is 3-5 bedrooms. The permit allows the rental of a bedroom (which may include a bathroom) on a nightly basis, and the tenant shares in the kitchen and other rooms.

No permit is required for the renting of a bedroom for a period of at least 31 days or more.

The requirements for each type of B&B vary and are detailed in Hospitality Commercial Establishments -- Bed and Breakfasts Section 18.40.250 of the San Juan County Code.

I have generally defined B&B restrictions below; however, a property owner should read the entire regulation when considering their property’s qualifications. The land use designation (zoning) of the area, and the site and building configuration are determining factors in how a building may be rented. Some general statements:

B&B Residential 1-2 bedrooms.
Maximum occupancy limit of 6 guests.
Must be owner-occupied single-family residence.
Parking must be provided.
Maximum of 3 guests if located on a private non-surfaced road and when the residence is more than 500 feet along the non-surfaced road.
Maximum guest stay is no more than 30 consecutive days.

B&B Inn 3-5 bedrooms.
A standard of three people per room is used to determine maximum capacity.
Must be proprietor-owner occupied single-family residence.
Parking must be provided.
If the property is served by non-paved County road for more than 500 feet, the permit will be limited to three guest rooms.
Not allowed if access is by means of a shared private non-surfaced access road.
Maximum guest stay is no more than 30 consecutive days.

Other Considerations

Prior to making a decision about which type of rental is suitable and what is best for the property, an owner should consider the expenses associated with each type of rental, proposed income, and the potential impacts. One expense commonly overlooked is B&O (Business & Occupation) tax on the income.

Short Term Property Management. Professional property management fees vary slightly and there are only have a handful of property managers on the island. The fees may sound high at 30-35%, but a property owner should consider that these firms are operating your investment similar to a hotel and managing crews for repairs and cleaning. They have service providers on staff or available that respond to their requests in a timely manner. If you decide to self- manage your property, the honeymoon with vacation rentals may be over in a short period of time.

An important note: Those who manage long term rentals for other people are required to have a broker’s license and maintain a trust account. Management of short term rentals does not require a broker’s license.

Consultants. I highly recommend that you utilize a land use consultant for the permit process. The consultant will not only guide you through the process, they will assist you with the discussions you may need to have with adjacent property owners, with County officials and help you hire service providers such as surveyors, septic inspectors, well testers, etc. They can also give you a list of suggested rules to post in your home to insure that the tenants understand the home’s functions and restrictions.

Covenants, Conditions and Restrictions (CC&Rs). As you may be aware, many plats have voted to restrict vacation rentals, as they deem them as a commercial or non-residential use. Even though the property may qualify for a vacation rental or B&B permit under the County code, the plat CC&Rs will over-rule the County’s allowed use. Many plats made the decision to prohibit vacation rentals due to negative experiences. They most likely considered that some tenants were not respectful of the adjacent property owners with their music, loud voices and trespassing. Further, with delicate water and septic systems, vacation rental occupants can add pressure to these systems unless the tenant received proper instructions. Occupancy numbers may be elevated if the tenant decides to have a party just like I had last week.

I was unable to locate any statistical data to support that a person on vacation does more dishes, laundry or uses the bath facilities or road systems any more than a family of four living in a home. My guess is they do use the refrigerator door more to get a fresh beverage and I assume the BBQ never gets a break. I can’t imagine any person on vacation creates more recycle than my family, but it is possible.

Town Water. Homes on the Town’s water system that are not zoned commercial do not qualify for a vacation rental permit. The best rumor I could find on this decision was at one time the hotel, B&B and motel owners felt that single family homes with vacation permits were direct competition and asked the Town to restrict the permits; water was a good vehicle to do so. However, now that periodically during the year the hotels, motels and B&B are fully occupied, it may be something that the Town should reconsider. Again, is there evidence that a vacation rental occupant on Town water uses more water than a primary resident? This will be a tough decision for the Town to weigh the pros and cons on.

Insurance. For the operation of a vacation rental home or B&B the property owner should have adequate insurance. Their carrier must write a commercial policy, the standard rental policy assumes month-to-month or long term, not nightly. The property owner should also consider having a liability umbrella policy in the event of a major injury to the tenant. The property manager’s policy insures them, not the property owner. Commercial homeowner’s insurance may be twice the price of a standard owner occupied insurance policy.


Having said all the above, options may change in the future. Rumor has it that the Council is considering amending the vacation rental ordinance and the need for a moratorium has been mentioned in public meetings.

One stated reason on the need for a moratorium on the issuance of additional vacation rentals permits is to increase the pool of long term rentals available to island families in disparate need of a place to live.

The unintended consequences of a moratorium may be that property owners will illegally operate a vacation rental in their home or use the 31 day loophole to avoid non-compliance. If a property owner has a rental agreement with a tenant for 31 days or more, that is defined as long term. Whether that tenant is on vacation and is paying what would be considered “Summer Rates” and only stays for 10 days isn’t an issue, they contracted for 31 days.

If the Council decides to place a moratorium on the permits, they may also need to consider enforcing non-compliance under a proactive pattern versus compliant based response. Enforcement may require a full time vacation rental police person.

How will that look? A cease and desist order is provided to the property owner who must call all of the future booked tenants and tell them that they were operating illegally? Now the County is no longer allowing them to rent their home, so sorry that your 10 year reunion with your entire family is now cancelled. Good luck with finding a new location.

This issue is not unique to San Juan County, this is a national issue due to demand created by people traveling and not overly excited about going to other countries or staying in large and expensive hotels. Other cities are considering moratoriums -although some are not as dependent upon the tourism industry as we may be.

The vacation rentals by owner (VRBO) or Air B&Bs are a newly created industry, and not yet fully regulated in most cities. We are all in the same boat and must review how these units are functioning and review the governing ordinances; similar to how cities are addressing Uber; which I assume is heading our way as well.

Lack of affordable rentals and housing in general must be addressed, but is it the best option to restrict how a property owner decides to have their property produce income? A lot of unanswered questions; and affordable housing is related, but an entirely a different topic that needs to be dealt with.

Neither vacation rentals nor long terms rentals “pencil” on this island. Rents may be high enough to pay taxes and insurance and some maintenance, but our levels do not typically meet or exceed the debt service of a highly leveraged property -such as one with an 80% Loan to value mortgage.

I believe that the vacation rental versus long term situation will correct itself for homes that are valued under $500,000. When a property owner does the math and realizes that the net income is very similar for both a long term tenant versus a vacation rental, the romance of vacation rental income will tarnish. It will be quickly replaced with a property owner’s overly burdensome, never ending, chore list of maintenance, repairs and tenant requests.

As in the case of real estate sales, many property owners here assume if Seattle is a robust market then the San Juan Islands are one as well, but that is not the case. Our sale and rental markets are very different from the metropolitan areas, and yes, a vacation rental in the Seattle area will debt service much better than one located in San Juan County.

As someone that works in the industry, I believe that before a moratorium is considered, a revision to the regulations should be implemented first. The greatest opposition is concerns over the tenant’s behavior and that is directly attributed to a lack of rules and use instructions provided by the property owners. I believe that the vacation rental permits should be renewed periodically. Complaints should be taken into consideration at that time and the permit suspended if there were ongoing violations.

In a perfect world, the County would collect evidence of business license and B&O tax payments as part of the renewal. Having the property owner evidence their septic inspection and well testing is reasonable, but a nightmare for administration to monitor and follow-up. Unfortunately, this type of administration would require another full time vacation rental police person and would no doubt increase the fee structure.

Impacts to the Economy. Homes offered into the long term rental pool provide local housing for islanders. Residents living and working here over the long term tend to have pride in community which results in maintenance of the home and may result in a lifelong commitment to being a San Juan citizen.

Vacation homes offer economic gain into the community and to the owner. While visiting, tenants enjoy retail therapy, restaurants, kayaking, and whale watching. Some may end up deciding that residing here is in their future.

B&O tax is generated back from the state into our local government.

The vacation rental homes are mostly occupied in the summer months and this coincides with when the second home owners return and desire to hire staff or service providers to help with their property maintenance. These service providers may be the very ones seeking rental housing.

Lots of pros and cons and last, but not least, to the SJC Council: good luck with the decision on how to restructure the vacation rental ordinance and whether to consider a moratorium. It is going to be a very difficult process.

Consultants in Alphabetical order for Vacation Rental or B&B Permit

Jack Cory 360-378-4900
Bob Querry 360-378-7053
Francine Shaw 360-378-6278

Property Management Firms:

San Juan Property Management -- Vacation Rentals Only 360-378-2070
Vacation Doorways -- Vacation Rentals Only 800-391-8190
Windermere Property Management -- Long Term Rentals 360-378-3600



IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

Thinking about selling your property? You may want to consider researching, collecting and completing the items detailed below.

This is not a check list for planting flowers on your porch and painting your front door, you can go to the internet for that information. This list is to prepare sellers in San Juan County for marketing their property. The issues below are for regulatory compliance, contract performance and will prove beneficial and worth the effort in the marketing and transaction management of your property sale.

If you hire a good agent, they will assist with the process of gathering and helping you arrange for the various services. That is what good agents do.

This list will not apply to all properties and it is not meant to be all encompassing.

Single Family Residence

“As Is” Sale
Washington is a due diligence state with the buyer able to process the suitability of the property with no risk to their deposit if their contract has contingencies. Some property owners believe by writing in “as is” on the contract that they are excused from making repairs and/or disclosing information about the property and buyer recourse. The statement indicates to the buyer that the seller has no intention of making repairs but the buyer may still obtain a home or other inspection reports as they deem necessary. Disclosure and recourse are requirements and rights granted by law.

It is difficult in a recovering market to provide an opinion of value and an upfront appraisal may be an option, although I don’t recommend one. The report cost range will be $500-$800. Unfortunately the report can't be used by the buyer if a lender is involved. The lenders have their approved appraisers list and must be the party that orders the report. Further, due to licensing regulations, appraisers are only able to utilize closed sales as comparable. The agents are able to use pending sales and current inventory to process their opinion which takes market trends into consideration.

Buyer Feasibility
It is not uncommon for the buyers to contract for a feasibility contingency that runs concurrent with the home inspection contingency. The home inspection contingency addresses the condition of the existing structures on the property and the feasibility study addresses the “what ifs”. It will be used by the buyer to confirm the cost of a remodel, to research what the home may rent for or the likelihood of obtaining a Vacation Rental By Owner (VRBO) permit and other similar items.

Some buyers are also processing soil stability and environmental studies which include mold and air quality within the buildings, at their expense. Bottom line, the feasibility contingency insures that the property is suitable and inspection results are acceptable to buyer, at their sole discretion. As a seller, you want the buyer to have the opportunity to process their due diligence and not rely on statements made by you or the agents.

Carbon Monoxide Monitors
Per national regulations all homes must have CO monitors and this language is contained in all purchase and sale agreements. The monitors can be purchased locally at ACE Hardware or Browne’s Home Center. The cost range is $25-$75 and the plug-in variety will suffice. The regulation directs you to comply with the instructions on each monitor as to installation. Basically, one CO monitor outside or near each bedroom and on each floor.

Corner Stakes
It is very important to locate the corner stakes on the property and mark them with flag tape. The old stakes on the island can be in the shape of a coin or pipe or wood . . . . . If you are unable to find the clear evidence of property corners and property lines, a surveyor should be hired. Locating and marking the corners may discover any encroachments that may exist. A full survey will be in the range of $2000-$2500 for 4 corners and level terrain. Each missing corner is approximately $400. Buyers want to know what they are purchasing.

Make sure that if your property is granted or burdened by any type of easement, e.g., view; landscaping; access; or utility; that a proper, recorded easement exists. Verbal agreements are not valid in real estate.

If your neighbor’s fence or outbuilding is over the line on your property, this needs to be resolved. The remedies that the buyer, lender and title firm will be of accepting of include a license, a recorded easement, boundary line modification or removal of the encroaching item or use. If you intend to remedy via a license or easement, you should hire an attorney and insure that language is included that requires the encroaching party to waive their rights to future adverse possession of the affected property. A license or easement will be in the range of $500-$1,000 subject to the complexity and whether all parties are in full agreement. If a boundary line modification is the solution, then a surveyor must be hired and that will be in range $1800-$2000.

First Right of Refusal
If your property is burdened with a first right of refusal, you must disclose this to your agent and potential buyers. Ideally the first right is recorded on your property and of public record but some are “hand shake” deals between neighbors, ex-wives/husbands, and relatives and they can get inadvertently overlooked which can be a fiasco down the road. Make sure you understand how the first right is “ripened” and the likelihood of it being acted upon by the grantee. An attorney should be engaged if the agreement is unclear.

Final Building Permit
Per the boilerplate language contained in our purchase and sale agreements, seller is required to provide buyer with a copy of their building permit with final occupancy signed off within 10 days of mutual acceptance. A copy of the permit can be obtained by emailing The department may charge up to $140 to research and then issue a copy to the property owners. If the permit final was not issued, an inspection from San Juan Building Department must be obtained and all work or repairs completed in order to secure the final. If the home was built prior to the existence of the Building Department, the home is grandfathered-in. If the home was illegally built without permits then a recreated set of plans and permit application must be submitted to the County. I would start by hiring a consultant for this type of project.

Forms Required to List
Be sure to request your agent to provide you with copy of the Exclusive Listing Agreement, Seller's Disclosure and all addenda so that you may review in advance at your leisure.

Guest Houses
Just because your outbuilding walks and quacks like a guest house, it may not be a legal guest house. Be sure to check how it was originally permitted prior to the marketing of your property. You can obtain copies of the building permits by emailing Some structures on this island had a range/oven installed after the final studio or bunk house occupancy permits were issued. If your outbuilding was not permitted as a guest house, you must not market it as such.

Home Inspection
It is common in many markets for the property owner to obtain a home inspection prior to the marketing of their property so that they may correct any deficiencies that are reported. The report cost range is $500-$600. Unfortunately, the buyer may not use the same report unless it was ordered in their name; otherwise there is no recourse against the inspector so another report will be required.

Home Owner's Association
Be sure to gather information regarding your HOA including the dues amount, regularity, and what is included in the dues such as water, sewer, and/or road maintenance. Have the contact information available as escrow will need this to confirm the proration’s at closing. Be sure to disclose special assessments and/or High Speed Fiber loans.

You need to know your total secured indebtedness. This includes your first mortgage and any other secured instruments. Agents will compile a list of your standard closing costs and those should be added to your total indebtedness. If the net proceeds are not adequate to pay off the indebtedness, you must bring in cash to close, or research if you are qualified to process a “short sale” with the lender.

Internet Speed
Most buyers want to know what internet speed is available at your property to make sure that it is suitable. You can download a free App called SpeedTest by Ookla and run a test on your property. If you already have fiber installed, be sure to let your agent know as they will want to include that in their ad copy to market your home.

List of Excluded items
Be sure to communicate with your agent the items that are not included in the sale e.g., your favorite mirror that is attached, your mom's light fixture, etc. Make sure those exclusions end up in the actual purchase and sale agreement. Just because the information is contained on the listing in the North West Multiple Listing Service (NWMLS), that is not part of the binding contract.

Owner Builder Permit Program
San Juan County is one of the few counties that allow for owner builder permits, which is not the same as owner contractor. If your home was built under the program after 1988, you are required to have the County perform a Life Safety inspection within 30 days of selling or renting the property. The cost of the inspection is only $111 and all repairs must be completed in order to obtain an acceptable final inspection. Fred will most likely be your inspector, so be prepared. . . . J

It is prudent to repair any dangerous items before you begin marketing your home. Potential buyers with their family and agents will be walking around your property and to avoid an accident, you should repair those loose handrails and the wet rot in your deck boards. Posting signs on any unsafe areas on your property is helpful but making the repairs prior to marketing is the best avenue.

For big ticket items such as decks, roof or siding, it may be beneficial to obtain bids for the repair. These bids also aid in the pricing of the home and your decision to either make the repair prior to marketing or hope for a cash buyer willing to assume the condition of the home. Lenders require at least a 5 year roof life expectancy and will not lend with less. Obtaining that roof certification or bids for repair will save time and delays versus waiting until you are under contract with a buyer.

Road Maintenance Agreement
Be sure to have proper, recorded road maintenance and use agreement for your access. If one is not in existence, contract with an attorney to arrange for one. The cost range will be $500-$1500 subject to the number of users and cooperation. Not all of the property owners are required to sign, just the majority. Lenders require this document. To confirm if one exists check with Chicago Title 378-2126.

Seller's Property Disclosure Form 17
This form will be provided to you by your agent and is a uniform instrument created by NWMLS in compliance with the State of Washington regulations. You must complete the form to the best of your knowledge but the advice is to always disclose issues even if you footnote that they have been repaired. This is a disclosure that the buyer is presented with as well as the home inspector. It is not a representation or warranty and is not incorporated into the contract however, if an issue arises after closing and the result is litigation, the form 17 will be popular. If in doubt, disclose!! Don't forget those un-permitted outbuildings, critical areas or your Pinocchio dock. The form 17 is mandatory.

Service Provider list
It is very helpful to compile a list of your current service providers to share with your future buyer. On this island each property has unique systems that must be maintained, it is amazing how long your list will be. Often buyers will contract for a system orientation from the seller as part of the purchase and sale agreement.

Your septic system must be inspected by one of the county approved inspectors. They will determine if the system needs to be pumped and whether any maintenance components will be required. The County code requires observation ports, risers and other maintenance components be installed prior to any sale. Be sure to specify when you order the inspection that it is “for the purpose of a sale” inspection versus a standard. Cost is $99-$200 for the inspection and $600-$800 for a pump out. Maintenance components will vary.

You need to have a copy of your septic “as built” to evidence that the system installation was permitted with a final inspection. You can obtain this on-line at with your tax parcel number. You need to make sure that the system size is equal to the number of bedrooms you have in the house and other structures. A bedroom is defined as a room with a closet and a closing door. If your system is only a two bedroom system and your home has three bedrooms, you need to market the home as a two bedroom. It is not uncommon in the marketing ad copy to read that the home is a two bedroom plus a den with closet.

If you determine that a permit was not obtained during the installation of your septic system, you can hire one of the licensed designers to remedy the issue. They will inspect the system, size it, locate the drain field and other components and draw up a recreation “as built” and submit that to the county. I have had those done for as low as $300 and as high as $1500, subject to the service provider finding the system components. Many items on the island are grandfathered in but health and safety issues are not; seepage pits are illegal.

Showing Instructions
Be sure to communicate the showing instructions for the home for you and your tenants; no one likes surprises.

Utility Expense
Most buyers want to know what reoccurring expenses involved in ownership of your property. Having those details available will be most helpful. OPALCO will provide you with an average monthly and annual amount.

All owners of the property must sign the legal documents required to list. If you use a power of attorney or the property is held in a Trust or LLC, those documents need to be submitted to your agent and the title firm.

Water Source Testing
Your well needs to be tested for quality which includes a bacteria test and a San Juan Short which includes testing for arsenic, barium, chlorides, sodium, electric conductivity, nitrate-N, and fluoride. The cost will be approximately $300.

Evidencing well quantity is also necessary. If you don't have your original well log you can obtain one from the State DOE website The well log report indicates the depth and quantity via an air test at the time of drilling. You want to avoid the buyer being forced to complete a draw down test on your well as it can be hard on your well and to other wells nearby. The draw down will increase your risk for salt water intrusion.

If you had to purchase water at any time during the year, be sure to complete Paragraph 2 section A-4 on the seller's property disclosure accordingly. Don't be on the wrong side of a water quantity issue.

Wells - Shared
You want to be sure that you have a proper, recorded well agreement for all parties using the well which includes a maintenance provision. Wells with three or more properties being served require additional language, restrictions and County approval. If no agreement exists, I would contact an attorney. The costs will be in the range of $300-$1000 subject to the number of participants.

You need to determine if you have wetlands on the property so that you can disclose to the buyer their existence. You can determine this by using the County site Search by tax parcel number then add map contents and mark critical areas including wetlands. If the program maps wetlands on your property they will have an impact on any future owner that intends to remodel or construct an outbuilding as setbacks may be imposed. If the wetland is a high value type, a delineation and survey may be required prior to any construction on the site to determine the setbacks. Cost to delineate is in the range of $3,000-$6,000.

Waterfront Home

Archeological Sensitive Areas
If you are on the waterfront it is quite possible that your property contains archeologically sensitive materials such as Indian Midden. You need to disclose this to any prospective buyer as they may plan to disturb the soil in the future through a remodel or landscaping, the presence of Midden will have a huge impact on their costs. If archeological sensitive materials are found on the property, no soil disturbance can occur without the presence of an archeologist standing by. They will monitor and audit all materials. If something is found that they determine is valuable, the job will be suspended until further research can be conducted and contact made with the State and Tribes. Not just waterfront property may be impacted by this regulation; properties across the street may be in the 500 foot buffer area of an actual site of sensitive material. Properties located near cemeteries are subject to this regulation as well.

To find out if you have archeological sensitive areas on your property, you can email with your tax parcel number. She will respond with an email to confirm whether you are in the designed site area or buffer areas. Should your property be in an area or buffer, the buyer will need an archeological study processed on the property prior to closing. The cost of the report is in the range of $3,000-$6,000 subject to whether materials exist.

Flood Insurance
If you live on the waterfront your home may be located in a designated flood zone. You may have existing flood insurance if you are in a flood plain and used an institutional lender. In order for a future buyer to obtain flood insurance, you will need a flood elevation certification even if you were insured in the past without one. This document is required by all flood insurance firms as it confirms if the improvements on the property are above the flood plain and determines the type and amount of coverage that the lender will require. If the buyer is not using an institutional lender, they may elect to waive flood insurance. The cost of the flood elevation certificate from a surveyor is in the range of $1700-1800. The time frame to process a flood elevation certificate is at least 30 days.

Flood Insurance Waivers
If you are in a flood plain and flood insurance is required, you may also obtain a Letter of Map Amendment (LOMA) which allows you to remove a portion of your property out of the flood plain and cancel your flood insurance if it proves to the lender that the improvements are above the flood plain and at less risk. Surveyors estimate that about 90% of the San Juan properties are eligible for a LOMA. Flood insurance is very expensive as the government no longer subsidizes the FEMA program due to major losses throughout the country. To obtain a LOMA a surveyor must be hired and the cost is around $2200. The time frame to process a LOMA is at least 45 days.

You should obtain evidence of your dock permit from the SJC building department. If your dock was constructed prior to the department's existence you are grandfathered-in. If you own a shared dock, be sure that you have a proper, recorded dock use and maintenance agreement. If you need one, an attorney can draw one in the range of $500-$1,000

Dock Disclosure
Be sure to disclose if your dock was permitted and if the extension was a Pinocchio or legal. At some time in the future, the county may decide to enforce compliance with the dock permits and you want to be on the right side of that issue.

Unimproved Land

Water source
If your property is located within a plat with a community water system it would be good to confirm the amount of the water hook fee and monthly base fees.

If your property is on a shared well, be sure that a proper, recorded well use and maintenance agreement exists.

The days are long gone where a buyer will purchase an unimproved parcel without the well being installed and seller being able to evidence quality and quantity. All lenders require a water source be determined and buyers are just not willing to take the risks.

If the most logical building site is a long distance from a transformer, it would be beneficial to contact OPALCO and determine the distance and what all they will require to hook up the proposed property. Once their specifications are determined, a bid can be obtained from an excavating contractor. The amount of this improvement is important as it aids in determining your sales price plus the transaction is not delayed waiting for the buyer to process the information while under contract.

Residential Pre Approval
If your property is on the waterfront or contains wetlands, the only way for a buyer to confirm where they can build, the location of the “no touch zones”, what trees can be removed and the allowed location of their utilities and outbuildings is to obtain a RPA. Most buyers will want this processed prior to a closing and will request a longer than normal escrow period. The cost range for the buyer is $800-$1500 and various consultants on the island process these. These are not binding so regulation changes void the approval. The only way to bind the County’s approval for proposed construction is to have a fully completed application for a permit on file; the safest way is to have the building permit in hand.

Once the Shoreline Management Program (SMP) regulations are in effect, it may be beneficial for sellers to obtain a RPA for the purpose of marketing their property. Any RPA processed at this time prior to SMP will be a waste of time and money.

If this list of potential issues is overwhelming, take a deep breath and contact a good agent. Realtors assist property owners regularly with all of these issues and their experience will help you process everything as painlessly as possible.

Recommend Service Providers:

Attorneys: Mary Stone 378-6778, Chris Skinner 378-2191
Surveyors: Robert Wilson 378-4300, Robert Anderson 378-5072, Andy Holman 378-0338
Septic Inspectors: Craig Starr 378-8070, Ted Lieker 378-7255
Septic Designs: Jack Cory 378-4900, Rick Pietro 376-2762
Home Inspectors: Tim Hance 298-1163, Darrol Scheffer 378-4969
Pest and Wet Rot: Jack Cory 378-4900
Well: Al Mauldin 378-6975, Martel 378-2842l
Archeology firms: Garth Baldwin 360-739-2451, Cascadia 206-366-0337
Appraisers: Mike Parades 378-5474, Mike Aikens 360-424-0331
Wetland Specialist: Scott Rozewood 468-4448, Mindy Kayle 376-5110

If you read this entire article, thank you. I apologize for the length but there are no shortcuts in real estate.



IG-Merri_Ann_Simonson-3 (21k image)By Merri Ann Simonson
Coldwell Banker San Juan Islands

As a Real Estate Agent, we are constantly learning and then sharing our knowledge with our clients. We must even expand our knowledge into some related industries that are not comfortable to discuss with a client, such as septic systems and their functions. The real estate industry isn’t just cars and contracts; it includes other really interesting stuff as well.

SEPTIC DESIGN AND INSTALLATION. The process starts off with unimproved land. A property owner or buyer must find out where on their site they should install the system and what type of system will be required by State regulations. There are various types of system options to select from. The latest technology includes systems that are considered mini sewage processing plants. Those manufactures claim that the effluent is nearly potable by the time it is pumped to the drain field. I am not convinced to that level but my opinion is based on the “ick factor” not science.

The system selection process includes hiring a licensed on-site designer who will complete a site and soil analysis and submit a design to the County for their approval and permit. The permits have a validity period of four years and the cost is around $1,250. The two most commonly used designers are Jack Cory 360-378-4900 and Rick Petro 360-376-2762. A full list of approved designers is available via the link shown below.

If the parcel is under a Purchase Agreement, the design and permit process is typically done by the buyer as part of the Feasibility Contingency, which is processed prior to closing.

Another aspect of the Feasibility Study is to confirm that any portion of the property is not located in an archeological sensitive area such as Indian Midden or near a cemetery. If the property does contain sensitive materials, you need to know where they are located. To confirm this information you need to contact Nadine Cook at San Juan County at 360-370-7585. Being located in an archeological sensitive area will add thousands to the cost of installing a septic system as reports must be filed and an archeologist must be present during installation.

All new systems are required to have a reserve drain field area in the event the first drain field fails. This can be difficult on smaller lots that have other restrictions such as being on the shoreline. Further, some lots are unbuildable due to inability to install a septic system; they become buffer or recreation lots. Their value is typically 50% of market.

The system is installed by an excavation firm licensed for installation. The service provider should be screened based on the type of system to be installed. Asking your designer for a reference is a good plan. The cost to install a new system will vary based on the type, size, and conditions of the site; the range is $10,000-$40,000, with the typical being $22,000-$25,000. It is prudent to photograph the site during the installation process so that you have documentation on the component locations; this makes servicing in the future easier. A list of installers is available via the link below:

The size of your system is required to be designed and installed as per your home building plans; i.e., the number of bedrooms in the plans should match the size of your system. Years back, some property owners felt that the systems were over engineered; hence the practice of building a 3 bedroom home with a 2 bedroom septic system presented itself. The result of this faulty logic is notable when a property owner decides to sell and markets the home. Real Estate Agents are only able to advertise the maximum number of bedrooms per the septic permit, not the floor plan. These rules impose creative marketing remarks such as “home offers 2 bedrooms and a den with a closet”. This lack of detail impairs the marketing of the home. Of course, if you have a 7 bedroom system and a 3 bedroom house, the marketing remarks remain at 3 bedrooms.

If you want to check the size of your system, you can find a copy of your permit at the County site that is shown via the link below. If your system is older, and the permit fails to disclose the number of bedrooms in the text, you can usually rely on the permit number. The last numeric digit of the permit number represents the size the system was installed for, i.e., Permit Number 2004-052-R3 is a 3 bedroom system.

INSPECTIONS. The County is mandated by the State to enforce the monitoring and regular inspections of septic systems. The frequency of the inspection is based on the type of system you have and varies from annually to every 3 years. The County does this by mailing out post cards that suggest it may be time for your septic to be inspected and pumped if necessary. Most property owners promptly file the post card in the “to do” pile which often doesn’t get “to done”.

When a property owner lists their home for sale, they are advised by their Coldwell Banker San Juan Islands agent that pursuant to SJC ordinance 8.16.160, a septic inspection is required and a pump may be necessary. A seller must evidence the compliance of their system to a buyer as part of the purchase contract. The evidence consists of a copy of the report completed by the inspector and a copy of the receipt for upgrades, repairs and pumping, if applicable. The purchase contract requires that the evidence must be less than 12 months old, however; if a lender is involved, the evidence may need to be less than 90 days.

An inspection is also necessary should a property owner apply for a remodeling permit. The cost of an inspection is in the range of $95-$300 and will vary subject to the type of system that is being inspected.

Further, if you are listing your property for sale and your system is older, the inspection results may require you to upgrade the maintenance components to become compliant. Required updates may include: access risers on tank and pump chamber, access risers on distribution box, observation ports, and clean-outs on laterals, audible alarms and effluent filters. Cost to upgrade your system is in the range of $300-$2,000, subject to the amount of work.

Cost to pump your tank is in the range of $750-$1200, subject to size of tank. As you may be aware, the content of your tank is disposed of off island which has a direct impact on the cost to pump. The inspectors do not recommend a pump out until the accumulated solids reach a determined threshold, which may range from 25% to 40% of the working depth of the tank, in most tanks that equates to 16 inches. Ultimately, unless a third party is involved, such as a lender, the decision to pump out is at the homeowner’s discretion. When the levels reach the threshold, a pump out is highly recommended as part of proper operation and maintenance.

Generally, most systems installed after year 2000 have the required maintenance components. The two most commonly used inspectors/pumpers are Ted Leiker 622-6338 and Craig Starr 378-8060. Both of these service providers can also install the maintenance components if needed. If the upgrades require a backhoe, then additional excavation contractors are hired. The complete list of licensed wastewater inspectors is available via the link below.

INFORMATION SOURCE. The County now has a great website for searching septic inspections and permits by tax parcel number. The site is very convenient for agents to use when representing clients as all historic inspections and permits are filed on the site and therefore accessible throughout the day.

DO-IT-YOURSELF INSPECTIONS. If you want to thoroughly understand how your system functions, you too can become a septic inspector for your own system. Do-it-yourself inspections are not allowed on the fully self-contained units such as the Advantech systems. Those must be inspected by one of the licensed designers on an annual basis due to the high level of technology. However, the Whitewater system may be self-inspected, if the property owner has taken the County class and been approved by the local Whitewater representative.

It is recommended that you do not conduct a self-inspection if you are processing it for the purpose of a sale on your property. That final inspection should be left up to the professionals due to the liability associated with do-it-yourself inspections and purchase contracts. Further, the County will not accept homeowner inspections for those inspections done as part of a real estate transaction.

If you desire to conduct your own inspections, classes are taught regularly at the County. You can contact the Health Department at 378-4474 to reserve your place in the class.

SYSTEM FAILURE. If your system fails, you will typically be granted a repair permit. Failed septic systems cause great damage to our environment so the repair permit process is regularly expedited. Systems fail for a variety of reasons; a few of the most common include surface damage, roots, lack of maintenance, and the worst is toilet paper and grease.

We can’t consider all aspects of a septic system without a riveting discussion about toilet paper. I know that TV ads claim that “Brand X” is great for your bum but it is a major problem for your septic system. Any of the soft cushy brands may fill up your tank. The thin types that break down easier may cause problems for your drain field. One expert was quoted to say “you should select a brand like Goldie Locks, not too thick and not too thin”. One should note that it is less expensive to pump out a tank than it is to repair a drain field.

Other preventive measures include using your garbage disposal sparingly, (if at all) use environmental safe bleach and cleaning products, don’t flush or rinse your paint equipment into the system; even water based paints are a problem. Don’t let a leaky toilet or faucet saturate your system. Protect your drain field from groundwater with a curtain drain that diverts the water. Don’t plant deep rooted shrubs or trees on or near the drain field or tank. Just like a boat, don’t flush anything not eaten first. Don’t pump unless needed.

The goal is to not kill off nature’s bacteria. There are numerous additives marketed for septic systems which according to some experts are a waste of money.

All newer systems that have a pump also have an alarm that lets you know immediately if your system is unhappy 24-7.

REMODEL. If you desire to enlarge the size of your system, it is a fairly easy project as long as the soil conditions support the expansion. Further, if your system is non-conforming due to location or age, it will be possible to repair should the need arise, but you may not be able to grow the size as that will increase the non-conformity, unless a different location on the site is available that will meet current code requirements.

I know that reading an article about septic systems and their functions isn’t the best entertainment but it is important that property owners and buyers understand the importance of the systems. Unless you live in town or at the Roche Harbor Resort; you are served by an on-site sewage system.

Rental Investment Options For San Juan Island


If you are contemplating buying a rental investment on island, one of the Roche Harbor Resort homes or parcels should be on the list for consideration.

I believe that the properties in the resort and nearby fared better through the recession. In 2005 I purchased a two bedroom rental house in the resort and have been very pleased with my investment. On San Juan Island our prices peaked in 2007 and reached the floor in 2013.

During that period our median home price decreased 30%. We have recovered since then and in some pricing categories of our market, we may soon be able to measure appreciation. As a REALTOR, I have noted that homes and parcels in and near the resort sell at a higher percentage over their tax assessment than other homes on the island. As an example, I paid $534,000 for the two bedroom rental home in 2005. If I add two additional years of average appreciation of 6% for 2006 and 2007, then calculate the 30% discount to market value due to the recession years, my house should be worth around $425,000 today, which is not the case. I recently had my home appraised and the value issued was $675,000. I can personally say that Roche Harbor properties hold their value in tough years.

The resort hosted over 105 weddings in 2016 and the majority of the wedding party and their guest stay at the resort in the rental homes, the hotel and other suites that the resort offers. Most of the families prefer to stay in the rental homes as they accommodate a larger group to include grandma and pa, and the rest of the family. The homes offer outdoor entertaining areas and are more cost effective when you consider the nightly rental rate is divided up by the number of couples staying in the house. This year larger homes have been the most popular in the rental pool.

The resort is also growing the shoulder season with various events such as sail boat races, boat club rendezvous, fishing derbies, and offering get-a-way packages at off season rates. They also attract companies looking for a retreat out of the city, family reunions, photography workshops, and bicycle tour groups. In addition they host an Irish music festival in the spring, church retreats, and bird watching groups. Locals and visitors alike enjoy the very popular Stage Left Productions which is at the outdoor theater.

Occupancy has been increasing steadily since 2005; however, will vary annually based on the amount of similar homes that are available for rent at the resort. For average occupancy days see the table below.

In the resort 50% of the existing homes are in the rental pool, the balance of the homes are primary residences or second homes. The rental pool generates a good income for the homes and is similar to the operation of a VRBO with Roche Harbor handling all of the reservations, website, light maintenance and cleaning. Their management structure is similar to a hotel with nightly cleaning if requested. They also stock the kitchen with dinnerware, glasses, and small appliances so that the items that are damaged can quickly be replaced with matching equipment and they provide all linen. The property management team at the resort does a very good job of providing a high level of customer service. They offer the least amount of owner involvement in the management as compared to other property management firms on the island.

The owner may remove the home from the rental pool at any time for owner use with notice and payment of the cleaning fee. Of course, heavy owner use will have an impact on the net operating income.

Below is an outline of the income and expense proforma for each type of home in the rental pool. Roche Harbor charges a 49% management fee as the homes are operated very similar to a hotel. Utilities are similar to any other home on the north end, but if the home is in the rental pool, as in the case of any vacation rental, commercial insurance is required which is more expensive.
At the resort the occupancy of the homes is more consistent than those homes offered via VRBO, owner managed or those with the private management firms on the island. The resort creates occupancy versus only responding to inquiries on their website as well as they have many return clients for the various events.

cbc_NewLetter_2016_RH_chart_1 (167k image)

The homes in the resort enjoy all of the resort benefits including access to the pool, boat launch, and tennis courts and convenience to the marina, restaurants, retail shopping and spa.

The resort zoning is designated as a Master Planned Resort with the intended use of nightly occupancy at the marina and in the residential units at the resort as well as a wide range of commercial activities. This zoning insulates an investor from any changes or challenges that the County or State may create in order to regulate the VRBO, Air B&B and/or B&B industries.

If you intend to buy an existing home and use it as a primary residence or second home, conforming financing is available at your favorite institutional lender. If you intend to place the home into the rental pool, then you need to seek out a portfolio lender and may need to secure a loan based on the income produced. A portfolio loan is typically slightly higher in rate and may be fixed for 3-5 years but then may adjust annually. These terms are set by the bank as these loans are not sold into the secondary market to FHLMC or FNMA.

The income property loan will require a debt service ratio of at least l00%, if not more, subject to your overall package. Basically, the property must be able to service all of the expense and debt without requiring owner contributions. The property and the income flow are the collateral for the loan. This equates to a lower loan-to-value ratio than a conforming loan, most likely under 50%.

I used my self-directed IRA to purchase my investment along with a non-recourse loan to the LLC that holds title to the house. I personally partnered with my IRA to purchase the property which allows me to management the LLC and associated bank account versus having to pay a custodian which would have been normally required due to the IRA involvement.

If you are just interested buying a parcel, seller financing is available for short term; under 5 years at 5% with 25% down. This type of loan is a bridge allowing a property owner to contract with their development team and arrange for a construction loan and secure permits. Once the construction loan is ready to proceed, those funds are used to pay off Roche Harbor’s loan.
Just in case you guessed, I am a recovering lender. I worked in the banking industry for 19 years before coming to my senses and becoming a REALTOR on San Juan.

The lot sales in 2016 and 2015 were very strong with most of the higher-end lots selling. Several of the homes sites are now under construction and several have plans to start in the near future. As the high-end homes are built along the ridge, the resort will have more depth and diversification. The listing prices for the lots include water and sewer hookup fees with telephone, power and fiber in the road.

Roche Harbor has a Pattern Book which establishes the image and character of the houses designed within the various neighborhoods of the community. The Pattern Book assures the scale, details and continuity of style throughout the overall Roche Village. The Pattern Book outlines the setbacks and site conditions that control the maximum square footage size of the home; there is no minimum home size.

What you decide for your interior floor plan, as long as it is within the framework of the Pattern Book, is completely up to you. If you intend to submit the home into the rental pool, the Roche Harbor Property Management staff and their REALTOR are available to consult on efficient and effective floor plans.

The Roche Harbor Town architect works with the owner, architect, designer, and contractor in monitoring the design process for compliance with the Pattern Book throughout the design and construction process. To ease this process, the team has several checklists to aid in compliance and communication.

If you plan to construct a rental house in the resort, you should budget $275-$300 per foot for the cost to construct, although several homes in the resort have exceeded that range. In addition, you need to have a budget for landscaping, furniture and personal property that meets the expectations of a high-end rental client.

As you may be aware, I am also Roche Harbor’s REALTOR but I write this article with my personal experience in owning one of the homes since conception and proudly recommending this type of investment. I feel very confident in the future of the resort, so much that I purchased a lot and plan to build another rental investment in the next few years.

As always, I must disclose that the proforma above is only a summary of the average of the income and expense associated with the rental of a two, three or four bedroom home in the Village. Actual gross income will depend on numerous variables, including size of home, location, season and the economy. Net income is also dependent upon variables such as mortgage amount, interest rate, taxes, maintenance and utility costs. Maintenance for the home and landscaping expenses vary and should be considered as well. This proforma is not intended to be a pledge or promise of net income from placement of a home in the rental pool.

There are numerous parcels listed for sale as well as several resales of existing homes. See the links below for more details.

Merri Ann Simonson
Coldwell Banker San Juan Islands Inc

Link to Roche Harbor Questions and Answers Form.

Link to Homes and Lots currently listed at the resort:

John Evans
Greg Hertel
Mary Kalbert
Ron Keeshan
Gordy Petersen
Janice Peterson
Bruce Sallan
Teresa Smith
Terra Tamai
Amy Wynn
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