KNOWING YOUR BOUNDARIES

Every now and then, we encounter a situation where the neighbors don’t agree on where one property stops and the other begins, and this can create complications if left unresolved.

In the case of a commercial property we listed in Watsonville, it was discovered during the course of our Buyer’s due diligence that the attributed square footage of the building was actually greater than the lot size. This was concerning, because it was a single-story building which meant that there was definitely going to be a property line issue somewhere. Upon digging a little deeper, it turned out that the building predated the assessor maps and there had been an error made when the parcels were created, as this particular parcel was drawn roughly 20 feet shorter than the building. 

The property had changed hands multiple times through the years, but the discrepancy only came to light during the course of our transaction. It turned out that a prior owner had started a lot line adjustment about 20 years earlier, but had never completed it, and the attorney who had handled the application was no longer in practice. We tracked down the engineering company who had drawn up maps of the proposed adjustment and engaged with a new attorney to complete the recordation of the corrected property lines, thereby resolving the issue. And the neighbor collected a settlement from their title company under the ALTA policy they had obtained at their time of purchase.

Another property we handled in the Soquel hills had a situation where a neighbor was offering to sell my clients a knoll near the home that had better ocean views, but the property lines they were pointing to didn’t measure up with where we were thinking the boundaries were so we engaged with a surveyor who came out and determined the knoll in question was actually already on the property my clients were acquiring.

More recently, on another listing we currently have up near the Summit, a neighbor raised questions about where our client’s entry gate and water tanks had been installed, which was understandably unsettling to the prospective buyer in contract. It didn’t feel fair for the Seller to take on the whole burden of cost for the survey, so the parties eventually agreed to an arrangement where our Seller and the neighbor would split the cost up-front and the buyer would reimburse each of them if they proceeded with the purchase, thereby ultimately sharing the cost three ways.

Based on the results of the survey, while there were some minor discrepancies observed, both the buyer and neighbor are satisfied with where the property lines are located and we appear to be on track to close escrow shortly. And now, each of the parties can now sleep nights not wondering about some unknown potential for conflict.

These types of details are always better to find out before proceeding with the purchase—and investing the extra effort, time and cost up-front quite often helps avoid potential for much larger costs in the future.