Many of us don’t think much about the water we use. If we turn on the tap and water comes out, we’re satisfied. When we hear ominous warnings about droughts, we stop watering our lawns (or limit watering to early mornings), but deep down, we’re not too concerned. The tap has never stopped working, so we expect that to remain the case.
However, if you are considering buying a property, whether it’s residential, commercial, land or industrial, one of the most important considerations is the water supply—is there enough water to do what you want to do year-round? Since droughts really are taking a toll on California ground water and other water sources, water rights will continue to have an enormous impact on real estate. Here’s how.
First, some places will have moratoriums on new water hook-ups, so if you plan to build a home in a place where all the other houses have water, you still may not be able to get it. Several years ago, this happened in Brooktrails north of Willits, Redwood Valley, and in the Ukiah Valley for properties in the Millview County Water District. Those moratoriums have since been lifted, but they and others could go into effect again if the shortage isn’t addressed.
Second, rationing could go from voluntary to mandatory. When we all do our part to cut back, there’s enough water to go around, but at some point, there may not be. This is when you’ll get nasty looks from neighbors if you leave a hose running while washing your car or you’ll stop getting invited to neighborhood parties because of your lush, green lawn. Rationing could come in the form of tiered water pricing: the more you use, the more you’ll be charged per gallon. That’ll make everyone (except teenagers) think twice about those 20-minute showers.
Even without a moratorium or rationing, access to water can be difficult and expensive to acquire. Right now, water hook-ups in the Ukiah Valley cost about $6,000 each, which is cheaper than the cost of drilling a well or developing a natural spring. If your property is off the beaten path, the hook-up to the water main is only the first cost. You then have to pay the construction costs of getting the water from the water main to your property.
In some areas, the cost of getting and/or using water may have an impact on your ability to develop the land. One of the problems local farmers face is the cost of electrical service to run the pumps that protect crops against frost. Even when farmers have almost limitless water rights, they find themselves in a financial bind because they have to pay PG&E a stand-by power charge—the fee for the privilege of using the pumps a couple hours every now and then. To be fair, it’s not unreasonable for PG&E to charge a fee since PG&E has to maintain the infrastructure to deliver the power to all the farmers’ pumps (at the same time) the moment a frost hits.
The next challenge occurs when there’s a misunderstanding about property boundaries and water rights. Even though your boundary line may go to the middle of the Russian River, you may not have enough water rights to get a watering can’s worth of water to soak your tomato plants. Property boundaries do not convey water rights. And that well you drill three feet from the river may be legally determined to be river water, and thus, illegal.
In this world, there are four types of laws: criminal, civil, railroad and water. The bookcases full of laws pertaining to water make sense when you think about it. Water is the life-giving, industry-sustaining substance we all depend on. To that end, California just passed a groundwater management plan that’s destined to have a significant impact on water rights, so before you buy property, make sure you know your water rights.
If you have questions about real estate or property management, please contact me at firstname.lastname@example.org or call (707) 462-4000. If you’d like to read previous articles, visit my blog at www.richardselzer.com. Dick Selzer is a real estate broker who has been in the business for more than 40 years.