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Saturday, July 29, 2006 - Page updated at 12:00 AM

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Home Forum

Try mediation to solve yard dispute

Seattle Times staff reporter

Q: My neighbor has made it clear that my yard doesn't meet his standards: He comes into it and trims my side of our joint hedge. He doesn't even talk to me about it. His latest tactic is to trim his side then throw a huge amount of cuttings into my yard. I haven't said anything to him, but I'm furious. What's my best option in this situation?

A: Conflicts like yours are tailor-made for mediation — a form of dispute resolution that helps you resolve the problem yourselves rather than in court, which by its very nature is adversarial. Ideally, at the end of the day, mediation will give you and the guy next door the tools to have a respectful relationship.

So how do you start? By calling your county's mediation center. In the Seattle area, that's the King County Dispute Resolution Center at 206-443-9603, ext. 1. A trained mediator will help you decide which of two approaches works best.

One option is to contact your neighbor yourself. The center will help you figure out how. For example, you could approach him by saying, "I didn't realize that the hedge was bothering you, but now I do and I'd like to talk with you about it."

The other option is to have the center contact your neighbor and arrange a mediation session. In that session, "the mediator will help frame it so it's not an attack," said Sue Ann Allen, the center's training director. That means allowing each side to voice their concerns and underlying needs.

"The mediator doesn't tell them what to do, but does help them brainstorm a solution," Allen said. "We don't take sides. What we're advocating for is helping both come up with a solution that will work for them."

About 85 percent of the time, both neighbors will agree to meet, Allen said. Sometimes the resolution center helps that along by sending the other neighbor an introductory letter explaining the center's mission and doing some "reality testing" around what will happen if the situation isn't addressed.

There is no cost for neighborhood mediations. Family or domestic mediation clients pay according to a sliding scale.

Q: An elderly neighbor's house apparently was bought by a real-estate agent without ever going on the market. The house is in a sought-after Seattle neighborhood and in good condition, but now it's being torn down to build a bigger one. I'm concerned that our neighbor was taken advantage of. Are there laws or at least ethical guidelines for this sort of behavior by real-estate agents?

A: An easy way to tell is to research the sale on Zillow.com. You can compare that home's sale price to Zillow's "Zestimates" of surrounding houses, as well as recent sales.

No laws or rules prevent real-estate agents from buying property for investment, noted Mike Skahen, owner/broker of Lake & Co. Real Estate in Seattle. He recalls a recent deal when an agent, trying to buy a house himself, offered $20,000 over list price. He lost to someone who offered almost $100,000 more.

However, agents are prohibited from using their knowledge to the detriment of an uninformed person, Skahen said.

This could mean, for example, not telling the seller about local demand or sales patterns. The best way for sellers and agents to avoid any hint of this is to put the house on the market and delay taking bids for several days.

When his sellers don't want to do this, Skahen insists they sign a statement acknowledging that they are willing to forgo a possibly higher sale price to sell the home quickly.

If you conclude that your neighbor was taken advantage of, you may be able to file a complaint with the state Department of Licensing, which regulates real-estate agents' and brokers' licenses. A complaint form is available online at www.dol.wa.gov.

Q: My wife and I own a vacation house in addition to our Seattle home. If we sold the vacation house and used the money to buy a second home, would we avoid paying capital-gains tax on the vacation-house profits?

A: No, you wouldn't because homeowners can exempt up to $500,000 in profit, or "gain," only from the sale of their principal residence.

However, there are a couple of ways you might be able to avoid paying capital gains on the sale of your vacation home, says certified public accountant Chris Dowsing of Morrow Kessler & Dowsing.

One is to convert the vacation house to a rental for six months or a year (there's no specific timeline), then sell it and buy another property as part of a 1031 exchange.

After renting out the replacement property for a while, you could make it your principal residence.

You could then sell it and potentially avoid capital gains — that's as long as you'd lived there at least 730 days out of the previous five years, Dowsing said.

Your other option would be to convert your vacation home into your principal residence (renting out your permanent home in the meantime) and hold it for the required time. Then you could sell it and move back into your old house.

"[But] one of the problems with making your vacation home your principal residence is that you have to file your tax return there," Dowsing cautioned.

If your house is in a state that has a state income tax — Oregon, for example — your move might be less financially beneficial than you think.

Home Forum answers readers' real-estate questions. Send questions to Home Forum, Seattle Times, P.O. Box 1845, Seattle, WA 98111, or call 206-464-8510 to leave a question on a recorded line. The e-mail address is erhodes@seattletimes.com. Sorry, no personal replies. More columns at www.seattletimes.com/columnists.

Copyright © 2006 The Seattle Times Company

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