Guest Column – West Marin Citizen

September 4, 2008

THE BUILDING MORITORIUM – GOOD FOR THE FISH, BUT TOUGH ON HOME SELLERS?

With the enactment of the building moratorium in February 2008, property owners in the San Geronimo Valley who want to sell their properties are wondering if they will be able to sell their properties easily, and at a good price.  If you have to sell, will you be stuck with only low-ball offers and bottom feeders?  The answer is no, but only with careful preparation.

To prepare a home for sale, do all the things everyone has already told you about painting and spruce-up, staging, neutral colors, and decorations.  But also get the facts about building requirements, site limitations, infrastructure, and loan constraints, or make sure your realtor does.  Don't hire anyone who says they don't know, or won't carefully research and flush out the key issues for your property ahead of time, or simply tells you to start spending your own money to find out.

Someone once said, "Information is power."  In this case, it may be the difference between an offer that results in a quick sale, and one that goes down in flames when a buyer, doing their due diligence, is surprised to learn about site constraints, building limitations, or other special requirements. There are some things that any savvy buyer is going to consider, especially in this market.  You as a seller should find out yourself ahead of time, and factor it into your listing.  Here are some.

The moratorium, which will be in force for up to two years, applies to new construction within "Stream Conservation Areas" (SCAs). The SCAs are areas within 100 feet of the top of the bank, on both sides of a stream that runs during any time of the year.  This includes a lot seasonal drainages, as well as disturbed drainages. Does this mean that no one will buy your property?  No, actually quite the opposite.  Having an existing structure allows you to rebuild or remodel it, as long as you stay within the building footprint.  It also allows you to add up to 500 additional square feet, as long as it is within the footprint, meaning you have to build up.  So, compared to raw land, you have a very valuable commodity during the moratorium.  Use that to your advantage. 

If you have a small house, get some idea how to rebuild the foundation within the same footprint in order to build an upper story and get additional size (and additional value).  Get some conceptual architectural drawings, and preliminary cost estimates that show how you could meet the moratorium requirements.  Evaluate the need, if any, for septic system upgrades.  Also, there are many ways to improve your property's drainage to possibly allow more buildable area to benefit the downstream water quality and the Coho Salmon.  Find out what these win-win alternatives are, including stream restoration that doesn't diminish the available buildable area, engineering fixes such as culverts, sediment traps, energy dissipaters, and other measures.  Find out what percent of open space you have on your lot.  It may be beneficial, in terms of future building approvals, to dedicate some open space for habitat preservation and rainfall infiltration. These are the kinds of things you need to factor in to your listing to set your home apart and impress the buyers.  As a client told me, "you came up with ideas that would allow development on the property and actually make it more friendly to the environment, thus achieving the goal of the moratorium."  This type of win-win strategy can really help sell a home.

Marin County has formed a Salmon Advisory Committee, comprised of local citizens, a representative from the Salmon Protection and Watershed Network (SPAWN), and other State and Federal agencies.  This committee is developing a watershed protection plan that will affect the properties in San Geronimo Valley.  Go the to committee's public forum meetings, so you will be knowledgeable about this planning process when buyers ask about it.  Get your own input into the process so ideas that both benefit the watershed, and preserve your property values, are considered in the emerging plans.  

There are other things to investigate.  Insurance companies are more concerned with wildfires than stream protection (sorry Coho).  The key factors are distance to the nearest fire hydrant (less than 500 feet is a plus), and the response time to the nearest fire station. Find out both.  If these are favorable, play this up.  If not, and your home is a long way away from fire protection services, think about fire-safe things you can do to compensate, such as clearing brush from around the house, trimming hazardous trees, etc.  Drive all the roads around you.  Consider how your home stacks up with others in terms of steepness, condition of pavement, etc.  Know that buyer's will notice this.  Find out how many minutes it takes to get to the nearest store and post office.  Also, find out how someone would be able to commute to San Francisco if they wanted to.  Drive to Fairfax and San Rafael on a normal day to know how far it is to larger cities.

As most know, is much harder to get a loan these days.  If your house is in very poor shape, it will not likely qualify for a traditional FHA loan because of the habitability requirements including electrical, plumbing and foundation.  There are, however, other means for a buyer to obtain a loan on such a property, including private money loans and construction loans, for which buyer lines up a licensed contractor ahead of time and presents a plan to the lender for upgrading the property to meet the habitability requirements.  These are all things you should know ahead of time, before you get into contract and the deal falls apart because the buyer can't get a loan.

As Trinity Whittaker, a homeowner who recently sold her Lagunitas home told me, "With the current Moratorium on building in the San Geronimo Valley, and considering the condition of our house and the fact that a creek ran through it, it was a very difficult property to sell."  I did sell her property, quickly, and at full price, because I did my homework, got the facts, and looked for win-win solutions early.  She told me "You accepted what was, and then proceeded to make the most of it."  That's a reasonable plan.  Investigate, plan, and play the hand you are dealt.  You will do just fine.

Patrick Ritter

Realtor and Civil Engineer

Patrick@PriRealtor.com