Sewer Negotiations

One thing I had to deal with over the last few weeks was what to do with the sewer line. During the bidding process, all the contractors had assumed there was a stub-out for a sewer line already there for the lot. From what I understand, this is a safe assumption to make. Unfortunately, there is no sewer hookup to my lot! There are two ways I can get rid of sewage. 

1. Run a sewer line about 100' up the driveway, tear up the street to tap into the main sewer line, and repair the street (all at my expense with city labor). I would also have to install a pump in the house to pump the sewage uphill. All this is very expensive ($20-30K).
2. Run a sewer line downhill along the north side of the neighbor's lot and hook into the side sewer at the sidewalk. This is much easier and cheaper (~$5K), but requires permission and a side sewer easement from the neighbor.

The decision was obvious. I first contacted the neighbor about tapping into their sewer line and they seemed to be fine with the idea. Fine, that is, until they talked to their attorney friend. Their friend vehemently recommended against such an agreement. Their first argument was that they incur some risk of me potentially clogging their sewer line. This isn't an issue as I would be bypassing their sewer lines and forking into the existing city line. They also said that they may have difficulties selling their duplex with an easement on the title. In my opinion, this isn't a big deal and it's apparently done quite often. If I were buying a house, the sewer easement would probably be the last thing I look at. 

A while later, a second issue came up. The same neighbor has an existing retaining wall on the south side of the driveway. It's about 60x3', handmade out of concrete scraps, and somewhat falling apart. They expressed interest in replacing the retaining wall with something nicer, but quickly disagreed when my contractor quoted them $6500 for it (it's an $8500 job). Since I have to undercut their retaining wall with my new driveway, that creates another new expense for me to try to support their structure and keep it intact. *grumble*

To try to sweeten the deal, I proposed that in exchange for giving me a sewer easement, I would replace their crumbling retaining wall with a nice poured concrete wall, equivalent to the one I have on the other side of the driveway. I also offered to cut down and dispose of the large bush in their backyard (a $600 value). This is a win/win situation for the most part. I don't spend nearly as much as option #1, and I get a nice driveway with proper retaining walls on both sides, while they get a new retaining wall and their bush taken care of. With this new offer, the neighbor gave me verbal agreement that he'll do it.

But not so quick! A day or two later, he had talked to his attorney again and had come up with a new list of demands. They wanted a set of proposed plans for the new retaining wall, a timeline, an indemnification agreement, and for me to pay the attorney's legal fees. When I had my architects draw up plans for the retaining wall, they also asked for the wall to wrap around the front of their duplex (probably an extra 2-4K expense). This was quickly starting to get ridiculous. I pushed back on the retaining wall additions and on the legal fees. Their attorney also suggested he could write up my end of the agreement (for a fee), which was ethically questionable.

Despite the already bad taste in my mouth from all this, the neighbor did still seem willing to move forward, and knowing that I could buy a car with the money I could save, I continued negotiating. Several days later, the neighbor came up with a new concern. He was worried that the sewer line would somehow disturb the cinder-block foundation to his duplex. This concern was totally unfounded, so to ease his mind, I had both my contractor and a foundation expert come out and say that this will not affect the foundation. Even with that assurance, he wanted me to sign something in paper that basically said that if his foundation deteriorates between now and the end of time, I would be responsible for repairing his foundation. In the words of Will Smith, "Aww hell naw!" Is this guy going to try to extort me? I only got to steam about that for an hour before he called back to say he's completely backing out of the agreement. Well thanks for wasting everyone's time!

Back to option #1!

In an effort to perhaps share some of my new-found expenses with someone else, I emailed the owner of the neighboring empty parcel and asked if he was interested in having me run utilities to his parcel and split the sewer cost before the driveway goes in. It would be a great selling point for that lot, and the future owner wouldn't have to tear up a brand new driveway to run utilities. He agreed to pay to run water and gas, but when he heard the estimated price tag on the sewer, he couldn't afford splitting the cost on that.

So in summary, I get no help from anyone and have to absorb all the extra costs, which are guaranteed to be significant. I'm forced to do option #1, but I will run a 6" line with a T-junction at the end of my lot in front of the house. Once the driveway is paved over, anyone who purchases the adjacent lot will have no choice but to hook up to my sewer line. When that time comes, I'll keep it simple and grant easement to my sewer in exchange for half of my sewer construction costs (whatever that ends up being). As for the south retaining wall, I'll build out a short concrete retaining wall in front of the neighbor's old one - just big enough to prevent the existing one from falling apart. I'll plant some shrubbery or something behind the wall to alleviate the eyesore.

How will I pay for this? The bank is of no use. A construction loan can't be re-negotiated, and anything over-budget has to be payed for by the borrower (me). If the money I saved up since March doesn't cover it, I'll probably borrow some from my parents or tap into my 401K (with penalties). Let's hope it doesn't come to that. Either way, I will be covered. I'm told that excavation/foundation work is the worst part of construction and the most likely to go over-budget. Once I'm out of the ground, it should be smooth sailing. At least I'm glad I'm no longer in decision-making limbo and can move forward.

Lessons learned:

• Lawyers bring out the worst in people
• Nothing's guaranteed until you see it in writing
• Don't count on anyone helping you out, even if things are in their favor
• Sewers are expensive
• Always have extra money laying around

Retaining Wall

The retaining wall for the driveway was completed on 5/12. First, the footings were set-up on 5/2:

The footings were poured on 5/4, forms were put in place the next day, then a few days later, the wall was poured. Here's what it looks like as the forms were removed:

From the street

From the end of the wall

Close-up of the end of the wall

 The concrete guys wanted to sand everything down and fill all the holes left by air bubbles, but both my architect and I made sure they didn't. All that is great natural texture for the wall. They did forget to embed the house numbers in the front of the wall, but I'm not too worried about that. Numbers can be affixed to the wall at a later point for an equivalent effect.

The driveway will follow the profile of the retaining wall, but will be about two feet lower. Once the foundation work is done, the wall will be extended to meet with the foundation.

House Number Typography

One of the cool things about doing custom construction is that one has freedom to create or customize almost any detail of the house. The only limits are budget, city code, and imagination. Since I'm a bit of a typography aficionado, I wanted to use an appropriate typeface for the house number. I wanted it to be very geometric and also subtly reflect the cool angles in the facade of the house. Both Futura and Neutra had some of those qualities. I ended up making a custom typeface by tweaking the terminals of the numbers to give it a more angled appearance.

This will show up stamped into the concrete retaining wall next to the street and laser-cut into the steel facade of the house.

Groundbreaking

Yesterday we finally broke ground. A bit later than I thought it would, but there was much to take care of. So, referring back to the list from my previous entry, I can check off several items.

• The silt barrier is up
•  Bids for the retaining walls went out, came back, and were revised again to factor in the foundation changes. The changes turn out to be a bit more expensive than I thought. We'll be going over-budget on the foundation. I should be able to absorb the extra expense. 
• Based on the bids we received, we signed a contract with an excavator to do the foundation and retaining walls 
• The property was staked out by a surveyor
• Water, gas, and electrical applications were submitted and are in various states of being processed

For the observant types, you may have noticed I didn't mention the sewer. That deserves its own blog entry. Here's what it looks like as of this morning:

With that large bush out of the way, it's the first time I can see the whole lot. Looking good! Also, here's what the driveway looks like:

The grass and debris is all scraped away from my side of the property. 

The first big task is to form the driveway. It has to slope downward into the main part of the lot. I think this is what the excavator will be doing over the next week or so. 

Pre-Groundbreaking tasks

There are several things that need to happen before we can break ground.

• A silt barrier has been erected around the perimeter of the lot
• An onsite kick-off meeting was arranged with the city to inspect the barrier, provide information about the construction policies and procedures that the city requires, and to give permission to break ground. This was a success. 
• Several requests for bids were sent out for the retaining wall and foundation work. This is probably the most expensive and involved part of the project, so it is important to spend some time making sure we have the right person and for the right price
• A surveyor was hired to come out to the lot and put stakes in all the corners so that we know exactly where the property lines and easements are. 
• An application to Seattle City Light needs to be sent out to get temp (and eventually permanent) electrical service to the lot. 
• A request for water service was sent to Seattle Public Utilities. I had to go to their offices in person to get it set up. They need to renew the water availability certificate on the lot before they can put an order in. This will hopefully be ready on Monday. 
• A request for gas service needs to go out to Puget Sound Energy
• A plan for sewer access needs to be established. I can potentially save a ton of cash by hooking into the neighbor's sewer line, but I need a signed side-sewer access easement from them. I'll be talking with them on Tuesday about that.

All those tasks don't necessarily need to be completed before we begin on the retaining wall, but we do need to decide on a subcontractor and figure out where the sewer will go. I'm hoping one more week and we can start digging. I want to see piles of dirt!

Meet the lot

Let's take a closer look at what I just purchased. First, the street. Looking south and uphill, I see this:

Looking the opposite direction (downhill), I see this:

It's a pretty quiet street, and it looks like parking won't be an issue for larger events. Now facing west, I see the driveway, with someone's car parked in it.

Walking down to the end of the driveway and turning around:

You can see the drop-off on the left side. That's about where the center of the new driveway will be. The idea is that the utilities will be run along the bottom edge of the drop-off, then dirt from the foundation will be used to fill the rest of the driveway. Now pivoting to the left, you can see the southern half of the lot:

It's currently a backyard for the neighboring duplex. Not any longer! Going around to the other side of the duplex facing west, there's another dropoff leading into the next lot. I think most of that slope is mine. 

Walking further down, you can see there's a view of Capitol Hill from ground-level. 

It should look pretty nice from 30 feet up. There's a little shed on this side of the lot:

That needs to be torn down. The giant bush needs to go as well:

Well, there you have it. That's what my 4700sq feet of land looks like right now. The first step is to get a silt barrier around the lot and then have an onsite pre-construction meeting with the city on Monday to get approval to break ground. 

Closed!

After many months of waiting I finally closed on the lot yesterday! I got an email about a month ago saying that the fix to the title was finally recorded. This meant I could finally proceed with closing on the lot. At this point, it had been almost 6 months since I signed the purchase and sale agreement, so I had to start all the financing from scratch. The good thing is that at this point, I didn't need to apply for a land loan and could get a construction loan right away. The next few weeks were a frenzy of phone calls and emails and some tense waiting. The following things happened:

• I had to gather up and hand over recent pay stubs, tax returns, and bank account statements to prove I had proper assets (just like with a normal home loan)
• The bank had to run a credit and reference check on me
• I had to get two full sets of plans from the architects to the bank
• I paid the bank ~$500 to get an appraisal done on the lot + proposed structure. The appraisal had to come up at or above the value of the loan. 
• I had to formulate and sign a contract with the general contractor I picked out to build the house
• The bank had to run a credit check on my contractor including a reference check on all of his subcontractors
• The purchase and sale agreement had to be amended to include stronger wording regarding the shared driveway between the two lots. This had to be signed by both me and the seller.
• I had to pay a deposit to lock in my interest rate at 4.999%
• The underwriter had to approve the loan and the loan amount

If any one of those items didn't go through, the whole process would come to a halt. Luckily, it all turned out okay. The only bad thing that happened was I had to increase my down payment to a very uncomfortable amount in order to cover for the changes made to the foundation. This is something I hope I can live with and won't come back to bite me in the construction phase. Anything that goes over the proposed budget + contingency during construction has to be paid out of pocket. My pocket. My very empty pocket.  

The final steps were to write a deposit check to the contractor, completely drain all my accounts with a massive down payment check to the bank, and sign the final set of loan docs at the title company. And with that, I am officially a land owner in Madrona. 

I can't quite celebrate yet though. The adventure is only halfway over. Will everything contintue going smoothly and on time? Will I go drastically over-budget, sink the project, and go bankrupt? I have no idea! Tune in to find out!