Tribes' new lease policy brings out "for sale" signs

The property listing sounds idyllic: a three-bedroom, west-facing waterfront home on Tulalip Bay with an asking price of $337,940.

But because the house is one of about 300 on Tulalip Reservation land whose leases will expire over the next 40 years, any homebuyer would ultimately have to walk away from the dream home or move it.

Home values are falling and "for sale" signs flourishing as nontribal owners decide what to do with houses on land the Tulalip Tribes have said will no longer be leased to people who aren't tribal members.

"These houses were never easy to sell, but the market has just died," said Dan Peterson, the manager of Windermere Real Estate in Marysville.

Peterson said there was always a fair amount of turnover on leased properties on the reservation because buyers didn't own the land beneath the homes.

But the decision almost a year ago by the Tulalip Tribes to not renew leases on 24 waterfront homes on Mission Beach and to offer only a final 15-year lease extension on 245 properties around Tulalip Bay has "drastically changed" the real-estate market, Peterson said.

The Snohomish County Assessor's Office this year lowered home values along Mission Beach by almost 75 percent and on other leased property on the reservation by 25 percent, said Steve Lightle, a spokesman for the office.

Bob Stewart, a real-estate agent for Brio Realty in Bellevue, said many agents are discouraging prospective homebuyers from looking at property on leased reservation land.

"A lot of agents will steer clients away because what happens in 12 to 15 years is totally up to the tribes' discretion," Stewart said.

The Tulalips have said they want to remove the homes along Mission Beach because of erosion on the cliff behind them and pollution in Tulalip Bay. But they also say that the terms of the leases have always been clear and that it's the tribes' right to reclaim the property for their own use.

"A lease is a lease is a lease," said John McCoy, the general manager of the tribes' Quil Ceda Village business area. He added that Mission Beach homeowners have seven years' notice to move.

But the Marysville Tulalip Community Association, which represents homeowners on the reservation, says that over the decades, the tribes regularly granted building permits to improve houses on leased land and gave no indication that leases would not be renewed.

At the least, the homeowners say, the tribes should compensate them for the equity in their homes, particularly if they plan to sell them to tribal members.

"We don't dispute their right to do what they want with their own land," said Tom Mitchell, the president of the community association. "But is it fair and equitable? We don't believe it is."

Mitchell said the tribes haven't responded to requests to discuss the issue. McCoy said any individual homeowners are welcome to discuss their leases with the tribal leasing office. McCoy also said the homes around Tulalip Bay could be sold to tribal members.

Lynn Thompson: 425-745-7807 or lthompson@seattletimes.com