Buyer & Seller Tools


Buying Property in the San Juans

If you have already chosen us as your real estate agency, you have accomplished the first step in the process of buying property in the San Juans. You may; however, find the rest of the steps of interest.

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. We believe an agent at Coldwell Banker San Juan Islands to be your best choice.

It is important for you to understand the Law of Real Estate Agency. Years back, Department of Licensing determined that most buyers felt that the agent represented them. However, the law at the time required all agents to be sub agents of the seller, thereby technically representing the seller. It was for this reason that State revised the agency laws to the current ones, which allow for three types of agency representation:

  • 1. Buyer’s representation is when the agent is representing the buyer and intends to obtain property at the lowest possible sales price.
  • 2. Seller’s representation is when the agent has a listing with the seller and is attempting to obtain the highest possible sales price.
  • 3. 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. Download a copy of the Law of Agency Disclosure to become familiar with it.

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.

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 we are working with a waterfront purchaser, we 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 the agent to property in different locations on the island. However, it may be that until a buyer has an opportunity to view the various different types of properties, they may not be able to narrow down or develop their priorities.

Once determined, this information should be communicated to your agent in order for them to focus on the type of property that meets your needs, thus saving you time and confusion.

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 with your agent 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 your agent 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 ask your agent to email you the Coldwell Banker San Juan Islands Quarterly Real Estate Market Updates. You can also sign up for the service.

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 your agent or communicated your preferences, your Coldwell Banker agent 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 five year process – which is totally subject to your time frame.

Purchase and Sale Transaction

Once you have located the property you desire to purchase, we 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:

Archaeological Sensitive Areas

You want to make sure that the property you are purchasing is not located in an archaeological sensitive area such as Indian Midden or near a cemetery. If the property does contain sensitive areas, you need to know where they are located. To confirm this information you need to contact Annie Matsumoto-Grah at San Juan County at 360-370-7585. 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 Archaeological Sensitive Area, you will need to obtain a report from an Archaeologist. The Archaeologist will perform a site inspection 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 Archaeologist 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 $1500-$3000 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-$4,000; setting just replacement stakes can be much less. We have several surveying firms available on the island and we recommend: Bob Wilson 360-378-4300 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. Jack Cory from First Inspect Inc, 360-378-4900 or Cheryl Purnell Albritton 360-378-2066 offer package Feasibility Studies. 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. For more information, please download our Flood Insurance Guide.
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 our internet connections. The DLS coverage will vary throughout the County. In some areas 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.

The best cell service in the islands is Verizon. Many remote locations in the islands do not have cell service. The County is currently seeking options to expand and enhance our cell and internet services in the future.

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 both.


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 site. You can request a permit package or review the County’s building requirements through their website.


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. The two most commonly used designers are Jack Cory 360-378-4900 and Rick Petro 360-376-2762. You can read more about septic systems via our Septic PDF

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 any required 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, $600-800 to pump and maintenance components can run $300-$2,000. Generally, systems installed after 2000 are in compliance with maintenance components. We 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 will take effect in March 31, 2014 and will implements 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 three most commonly used are Jack Cory 360-378-4900, Tim Hance 360-298-1163, or Darrol Scheffer 360-378-4969. The Home inspection fees are in the range $500-$600.

Title Report

Shortly after the seller accepts your offer, you will received 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 source is reliable.

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 quantity, bacteria and organic. A San Juan Short list is recommended. 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: Denny 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. In “good standing” 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, 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, 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-$10,000 subject to terrain and site difficulty; most site fees run in the range of $2000-$4,000. We recommend Scott Rozenbaum from Rozewood 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 no worries as we will guide you through the steps and issues. Please direct any questions or comments to

San Juan Island Real Estate Services

Recommended Procedures for Sellers

One of the first steps we recommend in selling real estate in the San Juan Islands 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. Coldwell Banker San Juan Islands has an agent who would make an ideal choice.

It is important for you to understand the Law of Real Estate Agency. Several years back, Congress interviewed hundreds of buyers to determine if they thought their agent represented them. In most cases, the buyer believed that the agent did represent them; however, the law at the time required all agents to be sub agents of the seller, thereby technically representing the seller. It was for this reason that Congress revised the agency laws to the current ones, which allow 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.

Download a copy of the Law of Agency Disclosure to become familiar with it.

Review Marketing Plan

Coldwell Banker San Juan Island’s marketing program is extensive and provides full brokerage services. It offers several exclusive features including the Coldwell Banker International presence. As a member of the Coldwell Banker franchise we enjoy international brand recognition and agent tools including exclusive publications geared to market island properties. More than 3,300 offices nationwide means buyers know Coldwell Banker’s reputation.

Coldwell Banker San Juan Islands leads our local market. Please see our “20 Reasons to Choose Coldwell Banker San Juan Islands” for more details. Your agent will prepare a complete marketing plan customized for your property. This will be presented to you at the same time your Competitive Market Analysis is reviewed.
Review the Competitive Market Analysis

A competitive market analysis (“CMA”) is an opinion of value produced by a Coldwell Banker San Juan Islands Real Estate Expert. When considering selling, one of our professionals will prepare a CMA upon request to assist you with the valuation of your property. The Coldwell Banker Real Estate Expert will evaluate the property by reviewing all recent property sales and determining the market value of a typical sized property factoring in 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 so made 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 forecasted market demand, the appreciation calculation, the cost approach based on present value of each component, the amount of comparable properties currently available and the subject property’s special features.
Completing the CMA allows the Coldwell Banker Real Estate Expert to develop an opinion of the value; this is part science and part art. That is why it is imperative to select an agent such as one from Coldwell Banker San Juan Islands, as we offer the experience and track record to support our conclusions of value.

Consumers should be cautious when using on-line home value estimators as they do not function very well in San Juan County. These systems assume that the properties are all similar, but as mentioned above, properties in our islands are very unique.

Pricing of the Property

Fair market value is the highest price an informed buyer will pay for a property offered for sale. A primary reason that sellers hire full service REALTORS® is for their experience and expertise which can result in obtaining the highest price for their property.

The purpose of our Competitive Market Analysis (CMA) is to assist you in determining the listing price. After reviewing current inventory and similar properties that have closed, you need to set the selling price you are most comfortable with based on your needs.

Some sellers choose to set their price ahead of the market. Due to their level of motivation, they understand and accept an extended marketing period. Here we explain why this is not the best decision:
Qualified buyers will purchase the property that they perceive to be the most suitable and best priced from the selection available. It is for this reason that the list price should not be above market value.
Properties priced properly typically sell within 30-60 days and for a higher percentage of the list price when compared to those properties that are on the market longer. This can be attributed to the level of activity when a property is first listed. Typically, agents notify their buyers as soon as a new listing originates. It is known that when properties first enter the market, sellers are less likely to negotiate on price. If the property is priced too high, buyers perceive that the seller will not be willing to negotiate down to a more appropriate market price and the result is lack of interest.

If the seller reduces the price at a later date, it may not bring back the buyer’s interest. In fact, the buyer may be lured away from the higher priced property as its pricing convinces them to purchase a different property that they perceive as a better value.

Properties on the market too long may also become “shopworn”. The first few questions that most buyers ask when considering a property are: Price? Days on market? And why is the seller selling?
Today’s buyer has a high level of sophistication that includes educating themselves on our market prior to their actual purchasing experience. This allows them to make an informed purchasing decision. It is unlikely that buyers will pay more for the property than they would have paid for a similar property.
In the end, over priced properties tend to help sell the competition.

Net Proceeds Calculation

Review your net proceeds calculation based on the recommend price range given by your Coldwell Banker Real Estate Expert. This calculation will estimate your net funds after paying all costs of sale, but not paying off your indebtedness or real estate taxes if any. Remember, your personal net proceeds requirement does not dictate the market value for your property.

Your Decision

The decision of whom to list your property with should be based on local knowledge and experience. This includes marketing, negotiating, transaction management and closing & follow up, which should not be underestimated. This is really where Coldwell Banker San Juan Islands excels. We are able to obtain the highest sales price for our sellers because we have more experience in negotiating transactions than any other firm in our area and because we have maintained the largest market share of listings and closings for nearly 50 years. It is this experience during the transaction that can make the difference.

Real estate brokerage is a performance-based industry. Clearly, not all real estate companies are alike. Results will vary dramatically based on a variety of factors, including the experience and track records of the professional you select. Choosing representation based solely on discount, rebate or another cash back scheme may seem like a good idea at first glance, but that is not always the case when all is said and done at the closing table.

Pelindaba Lavender Farm San Juan Island Washington

Understanding the Valuation Process

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 knowledgeably, 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 so 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 forecasted market demand, the appreciation calculation, 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. That is why it is imperative to select an agent such as one from Coldwell Banker San Juan Islands, as we offer the experience and track record to support our conclusions of value.

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 homes 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. Agents spend a lot of time explaining to buying clients why the website calculators are not reliable in our area. Below are two charts which evidence this fact. The accuracy tables for Seattle as well as San Juan County are only a 2 star.

Zestimates Valuation Seattle
Zestimates Valuation County

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. The two most active appraisers in our area and who we recommend are Mike Paredes 360.378.5474 and Mike Aikens 360.424.0331.

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.

Please direct any questions or comments to

San Juan Island Ferry Friday Harbor Washington

Flood Insurance

If you are considering purchasing a waterfront home in San Juan County or even nationally, you most likely will be introduced to the Flood Insurance process. 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 in San Juan County, when further analysis is done, do not actually require flood insurance.

FEMA contracted with the Corps of Engineers 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 15 feet. The maps are two dimensional and don’t take into consideration individual property elevations, slopes and shoreline. They error on the side of consumer protection and use the “blanket approach”. Bottom line, if you are buying or have waterfront property, it is designated as being in the flood zone by FEMA unless proven otherwise by a Professional Land Surveyor.

Whenever you are using a Federally Insured institution as your lender, a Flood Determination is required. If the FEMA maps indicate that the property is in a flood plain, flood insurance is required and must be obtained prior to loan closing. As of October 2013, a Flood Elevation Certificate is required by the insurance underwriters prior to issuance of a flood insurance policy. Most borrowers don’t question whether the insurance is actually necessary. As a result of the passage of the Biggert-Waters Act in October 2013, flood insurance rates through the National Flood Insurance Program will be increasing. It will be more important than ever to determine whether the property you are buying or your existing property should have flood insurance coverage.

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. If this determination indicates the property is in a flood plain, you will want to hire a surveyor to apply to the Corps of Engineers for the Base Flood Elevation (BFE) for your property. The fee charged by the Corps is in the range of $105-$350, subject to previous determinations in the immediate area and it typically takes 3-4 weeks. 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.

The BFE from the surveyor is also a key part of determining whether insurance is actually 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 the 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.
If the structures as surveyed are above the flood plain, then the improvements and a portion, or the entire 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 4-7 weeks. The total cost is approximately $1850 on average, which includes the BFE fee from the Corps of $105-$350.
I believe this to be money well spent as the $1850 represents a large portion 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 typically not within the standard purchase contract term. I quote a total of 90+ days to my clients so it may be necessary for you to close on your purchase and your loan and 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 BFE and possible LOMA so that you can avoid paying future 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. As in the case of many government programs, when you cancel, they will not prorate back your premiums for any unused term, so don’t count on a refund.

This article is for informational purposes only. As each property has unique characteristics, buyers and 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 Anderson at Star Surveying 350.378.5072 or Bob Wilson at San Juan Surveying 360.378.2300

Please direct any questions or comments to

Kayaking in the San Juan Islands

All About Wells

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. Due to the risk of closing before the water source is
determined, the days of clients purchasing land without the source are long gone. If one hopes
to use institutional financing, the lender will require that the water source be acceptable in
quality and quantity; in addition to a valid septic system permit and access to a electrical power

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:

  • 1. Individual Private wells
  • 2. 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.
  • 3. Class B water system; 3-14 users. In the late 1990s, the County began managing the
    approval process for this class 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 test annually and a nitrate test every 3 years 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.
  • 4. Class 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 $10,800 and the
    fee for Roche Harbor Water is $8,000. These hook-up fees do not include the installation
    cost for connection to the main sewer lines. Again, these systems have a base monthly
    charge plus a use fee.

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 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 $18,000-

A purchase contract should also contain a provision for satisfactory quality and quantity testing.
Those tests include a bacteria test for $35 plus $80 for the service call and a San Juan Short test
for $142. 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 14 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 risk of saltwater intrusion for
waterfront properties can also be too high to meet State standards, and this possibility is
always on the minds of agents.

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, however; 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. For
existing wells, if a well log is not available, a draw down test can be performed. The service
provider will pump the well down to the bottom 20% of the well, hold it there for 4 hours, and
then monitor the recovery. The cost associated with this test is around $500 and it provides
the gallons per minute figure.

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 Class 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
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, restrictor values and off-peak holding tank fills
such as during the night time.

If you are purchasing an existing home, the water system should be tested or if it is a Class
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.
Again a Bacteria and a San Juan Short are the tests of choice for existing private or shared wells.
It is best to locate a copy of the original well log to confirm quantity as processing a draw down
test can create a risk for salt water intrusion. You can find a copy of the original well logs by
visiting the Department of Ecology and searching by tax parcel number or well head ID number.

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 $2,800 and wetland delineations start at $2,600 subject to the typing and
amount of survey work required. A Residential Plan 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.

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 the County.

Please direct any questions or comments to

Orca Whales in the San Juan Islands

Real Estate Market Tax Assessment

All of us Island property owners received our tax assessment notices from the County in November. As real estate agents we have been fielding many questions about the statements and new assessments. As you may recall, the State has mandated that our Assessor’s office convert to an annual assessment update cycle versus the cyclical system we were on for years. The current values are for a one year period only and will be adjusted the next year. This process is much more stable and refined and will be a more accurate system than we have had in the past.

As agents, we have seen properties sell above their tax assessments the majority of the last 20 years with the exception of 2008-2012. Most of the variance was due to the lag time that accompanied the previous cyclical schedule our assessor used.
During a few years of the recession, properties were selling at or below the assessor’s values. For example, back in 2006, many of the same type properties sold in an average range of 125%-150% over their tax assessments. During the recession, many properties sold in an average range of 15%-30% below their tax assessed values. These average percentages varied based on the type of property but generally that was the trend. In 2014, due to market recovery, most homes are again selling slightly above their tax assessment. Due to annual re-valuations and the new assessor’s appraisal method, we may not have as extreme variances in the future.
Reviewing the tax assessment as compared to the actual sale price for high-end homes is not reliable as they are very difficult to appraise due to custom features.

Most of the confusion around the issuance of new tax assessments stems from the purpose and process of the tax assessment. The assessor is required to value properties for tax purposes at true and fair market value. The valuation assigned by a REALTOR for the purpose of marketing or the value assigned by an appraiser for the purpose of lending, estate planning or probate purposes, will most likely be a different amount. The process to the valuation is different for each therefore, the results will vary. Generally, the differences in the process are described below:

Appraiser and Agents:

Conducts an interior inspection then identifies at least 3 or more truly comparable sales that are recently closed that they either physically inspect or at minimum view via photographs in the Northwest Multiple Listing Service. Ideally closed sales should be less than 90 days old. They spend much more time on the property determining the desirability based on the features and amenities. They also rely upon a cost approach but a depreciation figure is deducted based on the age of the home and its condition. They will analyze the income approach if applicable and base the value of docks at market.

Due to the size of our market, finding truly comparable property sales in our County has always been the challenge. A real estate agent even differs from an appraiser as we can actually use “Pending” transactions as comparable sales. We also consider the current level of similar inventory and absorption rate in the category to assist in pricing a property for the current market for our clients.

Assessor’s Office:

The assessor’s office performs appraisals for purposes of ad valorem taxation. This is part of the process for how we provide funding to all local government services, including schools, libraries, ports, fire districts, the hospital district, emergency medical services, cemeteries, state schools, parks, roads, sheriff and government
Appraisers that work in the assessor’s office generally use information gathered from site visits without the benefit of an interior inspection. The characteristics of the home and land are considered and compared on a “mass appraisal” basis to all other properties countywide, with statistical analysis of properties grouped by similar market influences and characteristics. The “mass appraisal” method provides more equal distribution of property taxes among property owners within the jurisdiction through standardization and improved consistency in the work of appraisers.

It is impossible with the size of our County, and the size of our assessor’s staff to physically inspect every property on an annual basis. The properties will be valued every year and the assessor’s appraiser will physically inspect one-sixth of the county properties each year. Since the Notices of Value mailed in November were based on a January 1, 2014 assessment date, our assessor’s office utilized sales from 2013 to develop statistical data with which to update the value of all the properties in San Juan County. After reviewing and validating those sales, they use approved appraisal practices to determine the percentage of increase or decrease in value in neighborhoods of similar properties. 2014 sales will be used in the next cycle of the process.

As the assessor’s office performs this process on an annual basis, the historic variances noted in the second paragraph of this article will not be as extreme. If properties are actually selling above or below assessed values, those sales will be the basis for a statistical update the following year.

The assessor’s office is currently revising their method for valuing docks and will be using a more market based approach. This is a major valuation change for docks. The office is also valuing new construction, additions and remodels in a much more timely fashion.

The assessor’s office is required to assess at market value but with the constraints of limited access cited above, the task is quite different as compared to an agent or appraiser. The assessor is not allowed to be a member of the Northwest Multiple Listing Service and use their database but they do use the various brokerage firm’s real estate websites to view details and interior photographs which is allowed by the Uniform Standards of Professional Appraisal Practices.

The variance between the tax assessment and the values produced by appraisers and agents is expected as the process defines it.
Appraisers do not rely upon the tax assessed value as an approach to their valuation at all. The uniform reports don’t even request the appraiser to provide the assessment information. The appraisers never compare value conclusions with the assessor’s office therefore they are not influenced by the assessments. Their assignment is to provide market value to the lender or client, not the tax assessed value. It is also important to note that appraisers can and do provide opinions of value as of any given date; the assessor’s office is required to value property as of January 1 of each year so the aging of the assessor’s information will always be an issue, especially in an active market.

Agents are not licensed appraisers and there is no regulation surrounding how they calculate a property’s value; there is no uniform calculation. Some agents use the assessed values as a benchmark only. They recommend a list price to a client by applying a percentage to the property’s current assessment that is derived from the average percentage of sales price to assessment of similar recent sales. Some agents don’t rely on the tax assessed value at all and don’t let it influence their recommendation for pricing because they know the assessor doesn’t necessarily have access to the interior of the improvements. Regardless of what an agent recommends, the ultimate pricing decision is made by the seller.

REALTORs must, however, comply with Article 1- Duties to Clients and Customers of the REALTOR Code of Ethics which obligates REALTORs to provide an honest opinion of market value.

Buyers, of course, are looking for the best price possible and will use the tax assessments when it favors them. As agents, we are able to explain to the buyers the differences in the process and how the value amount may vary.

Websites such as Zillow, Redfin, and Trulia rely upon the various County Assessor’s information and valuations to process their own calculation. Their values may be reliable in Metropolitan areas where subdivisions of very similar homes are bought and sold on a regular basis, but the website’s calculation of value performs poorly in small, low volume, custom construction markets such as San Juan County. Again, as agents, we are able to explain to buyers that the website calculators are not reliable in our County.
Bottom line, we should all be pleased that our assessor’s office appraises as fairly as possible and uses the methods advised by the Department of Revenue and defined by statute. The tax assessment appeal process is straight forward which allows property owners to present their petitions themselves. Further we historically have had the lowest levy rate in the state.

If your value assessment is adjusted downward your tax statement may not have a correlated downward adjustment. Each tax district submits a budget for its expenses as constrained by state law. The total of the amount requested is divided by the total assessed value of each district. This results in a levy rate for each district. Your taxes are a composite of the levy rates for each district in which your property resides multiplied by your current assessed value, divided by 1,000.

If all properties increased or decreased by approximately the same percentage, you would likely see very little change in your tax statement regardless of the increase or decrease in your value. This complies with Washington State laws that were formed for the sole purpose of insuring that local government can rely upon a predictable amount of revenue each year so they could process a balanced budget. If the tax revenue had large fluctuations the result would be chaos for the local government services.

Another factor to keep in mind when considering your tax bill is the number of acres and percentage of total acres in San Juan County that are either exempt or pay a reduced amount due to being in a special use program. The taxes that would have been paid by these properties are shifted to the taxpayers based on public policy decisions by the State and County legislature.

Download a map showing exempt properties.