Nutria, the beaver-like rodents from South America, are on the rise again in some Portage Bay and Lake Washington areas. They were introduced to Washington and Oregon in the 1930s for fur production, but like many such experiments they got wild and “went wild” breeding and multiplying outside of fur trappers’ control. Considering that their natural predators include alligators and caiman, no wonder they do fairly well here!

Nutria can be trapped and exterminated, which some folks are doing since they can act like moles and tear up valuable shoreline. Some government agencies are looking to get more involved in a wider and more coordinated program to rid the area of this non-native species, but those plans are in the early formative stages.

As part of the larger market trends, waterfront homes have become more affordable and with higher selection. In some communities, the prices have held up very well due to continued demand by a general group of buyers insulated from the broader market issues of credit, income, mortgage options, and such. However, there are also an increasing number of good options in quality second tier waterfront locations, and supply and demand is gradually catching up with market realities.

The upside for sellers though is that the relative valuation and appreciation of waterfront continues to be stronger in relationship to the rest of the market. It’s always good to have a valuable, in demand type of property where they aren’t making any more shoreline, but they sure can make more inland subdivisions and condos.

An article appeared in today’s Seattle Times about this topic. Although the specific anecdotes in the article are not locally based, the general concepts can still apply.

Geese can be a troublesome part of local lakefront living for some. Geese love wide open manicured grass that comes to the water’s edge, like many home owners have. Lawns provide them with foraging spots and open sight lines with no hiding places for predators. The main downside for many waterfront owners: what the geese leave behind…

The easiest way to get rid of geese on your lawn is to create a native vegetation buffer between your lawn and the water. This blocks the sight lines and access routes that geese prefer, and they will move on to open lawns elsewhere. Choose native vegetation of varying heights so that you can frame and enhance your views, with a majority of low lying bushes and native ground cover so that your views are maintained at your eye level but not at the geese’s eye level.

This also provides other benefits to your property. Native vegetation buffers such as this help filter pollutants from your lawn before they enter the lake, and they provide insects for fish and birds. Also, in the rare event of severe wind that creates a lot of high wave action, the larger vegetation will protect your soil and landscaping from erosion far better than grass.

Here’s the latest update from King County on the public input process to proposed changes of our local Shoreline Master Program:

Preliminary King County responses to public comments received on the draft Shoreline Master Program update from October – December 2007 are now available. Phone message comments were received until September 2007; due to a technical error phone messages after that period were not recorded.

King County plans to release a third public review draft in late summer 2008 and hold a series of public meetings in fall 2008 before transmitting the Proposed Shoreline Master Program to King County Council in November, 2008.

Shoreline Fact Sheets
Draft Shoreline Master Program (September 2007)

King County commissioned a phone survey in winter 2007 to help understand public goals and priorities for managing shorelines. Results are available from the Shorelines Public Survey Findings page.

King County will release a third public review draft in late summer 2008 and hold a series of public meetings in fall 2008 before transmitting the Proposed Shoreline Master Program to King County Council in November, 2008.

Please send an email to shorelines@kingcounty.gov if you have any questions.

As I wrote about before, King County is now in its second phase of updating local Shoreline Management Program designations, policies, and regulations. This is a good opportunity for you to learn about existing and proposed regulations, as well as contribute your thoughts and opinions on the topic.

The county provided a good overview of their upcoming events, which I’ll quote here for your info:

Learn more.
· Visit the King County Shorelines Web site to review the first draft of the updated Shoreline Master Program. Hard copies of the draft will also be made available in public libraries and community service centers in October 2007.
· Schedule a special presentation for your organization by contacting Mary Rabourn at 206-296-1977. (Meetings will be scheduled based on staff availability.)
· Attend an upcoming Open House near you (dates below) to learn about what is new in the draft Shoreline Master Program and the King County Comprehensive Plan, ask staff questions and provide your comments:

Public Meetings – Draft Shoreline Master Program and Comprehensive Plan
· Oct. 11, 2007: Cascade View Elem. School / Snoqualmie, 6:30 – 8:30 p.m.
· Oct. 15, 2007: Vashon-Maury Island UAC meeting / Vashon, 7:30 – 9 p.m.
· Oct. 16, 2007: Kentridge High School / Kent, 6:30 – 8:30 p.m.
· Oct. 18, 2007: White Center Heights Elem. School / Seattle, 6:30 – 8:30 p.m.

How to submit comments.
1. Online: Visit the New King County Shorelines Web site to submit comments, sign up to receive e-mail updates or look up information about a shoreline area: www.metrokc.gov/shorelines/
2. Email comments: CompPlanAndShorelines@kingcounty.gov
3. Mail written comments:Attn: Shoreline TeamKing County Department of Natural Resources and Parks201 S. Jackson St., Ste. 600Seattle, WA 98104

What’s next?
· Fall/Winter 2007 – Public meetings for review and comment on the revised draft program.
· December 28, 2007 – Deadline for public comments
· March 2008 – King County Executive will transmit a proposed Shoreline Master Program Update to the Metropolitan King County Council for review, public hearings and adoption.

The National Flood Insurance Program (NFIP) is up for a vote again, and this insurance provides important affordable coverage for people in many areas of the Seattle / Puget Sound region. Most home owner insurance policies do not cover flood damage, and many home owners are not even aware that they have no coverage in this area. The NFIP covers obvious areas such as rivers overflowing their banks into property, yet many people also don’t know that it includes high tidal/wave action on the Sound, land movement due to heavy rains, mudslides, and related catastrophes that could potentially destroy a home and yet not be covered by the home’s regular insurance. With our area’s huge expanses of Sound and lake coastline, and our steep terrain with homes perched on fragile hillsides to maximize views, this can be important insurance for many home owners in many different locations.

The Federal Emergency Management Agency (FEMA) Mitigation Division manages the program, and it is federally subsidized so the rates are lower than would otherwise be available through private insurance (though of course there is the hidden generalized cost in our taxes to pay for the subsidy). Private insurers have been steering away from flood insurance over the years. Many high risk areas do not even have realistic private flood insurance options, and NFIP fills the void.

The legislation under consideration this week is HR 3121 Flood Insurance Reform and Modernization Act of 2007. This resolution extends the program for 5 years, increases coverage limits and inclusions, adds optional wind coverage, and other items. If this is of interest to you and your community, I recommend calling your Congressperson and expressing support. Later this year the Senate Committee on Banking, Housing and Urban Affairs will be creating its own NFIP reform bill as well.

1031 tax deferred exchanges, which allow the owner of an investment property to roll over gains into another “similar” investment property without paying taxes on the gains, can include personal vacation homes. However, the personal use of a vacation home must officially be restricted, usually keeping personal use to under 14 days a year or less than 10% of the time it is rented out.

There have been recent court cases clarifying the allowable personal usage of vacation homes, and what distinguishes between allowable and non-allowable properties for making a 1031 exchange at time of sale. A recent sale and 1031 exchange of a lakefront second home for another larger waterfront home tested some of these boundaries, and clarified some rules on the matter.

In general, there are several important aspects that a vacation home owner can do to demonstrate both intent and actual practice of maintaining a property for investment purposes. This includes: renting the property out and claiming the income, tracking expenses, depreciating the asset, deducting mortgage interest as an investment expense instead of a second home tax deduction, type of tax filings, and number of days of personal usage. Also, a property that is initially used mostly for personal use may be transitioned gradually over more to investment/rental use for a period prior to sale, and this could help justify a case that it was an investment property eligible for a 1031 tax deferred exchange. This is somewhat untested in the courts but some experts feel it could work if an exchange were questioned by the IRS.

There is likely an unexplored gray area between “personal usage” and “onsite maintaining of the property to uphold the investment value”. If you are onsite for the purpose of maintaining and inspecting the property, then likely it would be beneficial to document this with receipts (from the hardware store or such) and a simple log of activities.

It is important to note that the IRS does not accept just market value appreciation of the property to be a valid justification for establishing a vacation home as an investment property. The IRS recognizes that a property can be left on its own for appreciation, but if it is used for personal purposes then it must be treated as investment property via intent and practice as discussed above, even if part of that does not include rental income.

There are a lot of options out there for people who already have a vacation home – or else want to purchase a second/vacation home – and would like to enjoy the benefits of rolling up their gains via a 1031 tax deferred exchange. This is especially the case for people who don’t visit the property frequently and who also do advance accounting and tax planning practices in line with investment property approaches. Lots there to talk to your tax and legal advisors about, but very intriguing…

Because of my specialization in waterfront homes, KIRO TV contacted me this week about doing a story on houseboat living in the Seattle Lake Union area. The reporter, Michael Fox, was interested to show people what a houseboat was like both inside and outside, especially for people who had never been on one before.

So I took them on a personal tour of a current listing of mine that was then located at a prime end of dock view spot on the Ship Canal leading to the lake, and we got together for a nice sunny day on the water.

For all of you boaters out there: A large array of educational and water safety organizations will be hosting Safety on the Sound 2007 at the Des Moines Marina, 22307 Dock Ave S, on Saturday May 12th from 10am – 2pm.

Participants include US Coast Guard Auxiliary, Flotilla 32, Puget Sound Keeper Alliance, South King Fire and Rescue, Mary Bridge Children’s Hospital, Safe Kids Program, Boaters World Inc., United States Power Squadron and Poverty Bay Squadron, City of Des Moines Marina, and the King County Sheriff’s Office Marine Unit.

Should be informative and helpful as we get ready for a new boating season upon us!

If you own or are considering purchase of property with wetlands, which can include anything from boggy areas to full waterfront properties on large bodies of water, then you may be interested to attend an in-depth two day course that teaches about many aspects of properties with wetlands:

• Functions and values of wetlands
• How wetlands are identified and classified
• Regulations involved when buying and selling properties with wetlands
• Wetland mitigation
• Wetland mitigation banking
• Working with wetland consultants
• The role of land trusts in regard to wetland properties
• Afternoon field trip to a wetland

• Date: Wednesday & Thursday, April 18 & 19, 2007
• Times: 8:30 am to 4:30 pm
• Place: Lacey Community Center (directions sent upon registration)
• Fee: $180, includes resource binder, lunch, and morning refreshments

For more information, contact Kelly Martin (360-786-5445 ext 7915 or Martink@co.thurston.wa.us) or Karen Janowitz (360-786-5445 ext 7918 or janowitz@wsu.edu).

The Seattle PI recently raised awareness again about the efforts of the local volunteer group Friends of Street Ends, which works toward ensuring public access to the approximately 148 different street ends that run directly into Lake Washington, Lake Union, Ship Canal, and Puget Sound. They are trying to maintain, create, or open up these public property street ends as miniature waterfront access points and mini-parks for the local community. Recent negotiations regarding a specific street end on Lake Washington were reported, plus how it had all gone before the state Shorelines Hearing Board. In a somewhat unusual result, it seems that both the community and the adjoining affected waterfront property owners are fairly happy with the end result (which dictated that private/public stairs did not need to be replaced/relocated by the waterfront property owners). The owners were concerned about public intrusions onto their private property, as well as safety and disturbances that sometimes come with next-door public access, but hopefully the local community will be respectful of their rights to quiet enjoyment.

Waterfront property is valuable for its aesthetics, beauty, and access to public waterways. This sometimes creates friction when private property owners want their expensive private property privacy, and local inland community members want to share in their public access rights to the same bodies of water. Over many decades, variations on this idea also have created a very interesting and unusual array of encroachments and easements on some waterfront properties, and these are rarer to find in non-waterfront properties. Here are some examples to be on the lookout for, so that you can make your own informed decisions regarding any effects on your current or future property’s values and enjoyment:

1) Encroachments onto public right-of ways. This includes the street ends mentioned above, but may also extend onto adjoining parks, boat ramps, and other examples. A survey and determination of surrounding properties can help address these questions.

2) Encroachments onto private property. Fences, old shacks, overhangs of buildings, shared walking paths or steps down an embankment, and many other types of encroachments can create issues of “understood” ownership that are contradicted by a professional survey. If next door to a commercial property, the same situations can apply there also.

3) Adverse possession. Examples such as the encroachments above, or even just access provided over many years across a person’s property to the water, can create adverse possession. Adverse possession in Washington is basically “open and notorious” use of another’s property continuously for over 10 years, and it can create a situation where the trespasser can claim legal right to ownership of the property even though another person actually owned the physical space per legal descriptions. I have significant qualms with that concept, but it exists nonetheless and does come up from time to time due to waterfront values and long forgotten sloppy maintenance of property lines and official permissions for accessing property. There are ways around it where a neighbor can provide access or temporary/ongoing use while still ensuring that the property will never fall under adverse possession (you can contact me for basic info and an attorney to really do it).

4) Easements. Easements are a way of life on some waterfront properties. Older communities may have a mish mash of access easements that go from inland properties and across some waterfront properties. This may have been exchanged among friends, or been part of a land deal, or sold for a relatively small exchange of value, but most importantly it usually doesn’t hold any value to new owners and is only a potential source of friction regarding access rights across their property.

I personally was involved in a waterfront deal where one property encroached on an adjoining property by 5 feet, and the 5 foot encroachment rippled across 5 different properties in a row until the last one was effectively shorted 5 feet. This situation was not discovered until years after the initial encroachment (by a professional survey team who repeated their work three times due to the controversy it created). Was there ever a lot of discussion and negotiations that resulted out of that surprise finding!

The take-away from all this: it’s very important to check existing surveys, information on surrounding properties, and all aspects of a full title search, plus ask around regarding any possibilities of adverse possession. All of that is not a 100% solution, but it certainly can go a long way toward eliminating surprises later.

If the record November 2006 floods adversely affected your home, business, or place where tax-related records are kept, you are eligible to receive various forms of tax relief this year. King County was included with 10 other Washington state counties in the Presidential Disaster Area resulting from storms, flooding, mudslides, and landslides that occurred throughout the state in November.

Most of the relief areas include significant time extensions across a wide range of filing dates, both for personal and business forms. Also, individuals may deduct personal property losses that were not covered by insurance or other forms of reimbursement.

If any of this may apply to you, consult your tax advisor to utilize the relief areas and to obtain more specifics for your particular situation.

The Washington State University Extension Water Resources Leadership Team is providing a full day class – intended for both real estate professionals and waterfront property owners – that details impacts of shoreline development and how to best work with natural processes that occur along shorelines. I’ve been to a similar class in the past and it was quite interesting and informative; it includes classroom time plus a shoreline field visit to have hands-on discussion and learning.

The instructors will cover the following topics:
Natural shoreline processes
Bluff processes
Signs and risks of landslides
Avoiding natural hazards
Issues of human modifications, including bulkheads
Shoreline stabilization
When to contact a consultant
Alternative methods of erosion control
Regulatory framework
Field visit to a shoreline site (wear weather appropriate clothes)

The class is 8:30am – 4:30pm way out in Shelton (about 1.5 hour drive from Seattle) and costs $120 (which includes materials, refreshments, and lunch). Contact and registration information is available on their website.

Come visit Seahurst Park on the Puget Sound shores of Burien to experience the beach creatures that come out on a low tide winter evening. The event will be led by naturalists from the Environmental Science Center and People for Puget Sound, who will provide hot drinks. They’ll have a glowing bonfire to gather around and share stories before walking the beaches at night to educate you, your friends, and family about many things you likely did not know before. Prior starlight walks have been a big success with a great turn-out, and I’ve found them to be very fun and educational.

Be sure to bring weather and temperature appropriate clothing, good flashlights, and waterproof boots.

Date: Saturday February 17
Time: Starts at 7:30pm
For additional information: 206-988-3712