AFH Club · Buying or Selling
Buying or Selling an Adult Family Home
Buying or selling an Adult Family Home involves both a real estate transaction and a DSHS licensing process running in parallel. Understanding how these two tracks interact — and where they diverge — is essential for both buyers and sellers to protect their interests and their residents.
Key Concept
What Is a CHOW?
CHOW stands for Change of Ownership. When an Adult Family Home is sold, DSHS requires the new owner to apply for a completely new AFH license. The existing license does not transfer to the buyer — it is valid only for the seller and that address, and it closes when the seller relinquishes or surrenders it.
This means the buyer must meet all current DSHS qualifications, complete the same training requirements, pass a background check, and have the home inspected by DSHS as part of licensing — even if the home was recently licensed.
The DSHS AFH Locator shows limits and enforcements issued in the previous three years only. Anything older, and anything still in progress, you learn by asking the current owner. The new owner must correct every deficiency that exists at the time of the ownership change.
For buyers: Check the DSHS AFH Locator and ask the seller directly about any ongoing limits, exemptions, or outstanding enforcement on the current license before making an offer.
For Buyers
The CHOW Process — Step by Step
A CHOW buyer files a full license application. DSHS will not estimate how long a change-of-ownership license takes; a complete application avoids delays. Its posted queue showed applications received in May 2026 being processed in late September 2026, and once an application is complete, processing can take up to 60 days.
Research the home thoroughly
Use the DSHS AFH Locator to check the home's licensing status and any limits and enforcements issued in the previous three years. Ask the current owner about any ongoing limits or exemptions, any outstanding enforcement on the current license, and any specialty contracts in place. The new owner must correct all deficiencies that exist at the time of the ownership change (WAC 388-76-10105).
Verify specialty contracts separately
Specialty contracts such as Expanded Community Services (ECS) and Specialized Behavior Support (SBS) do not transfer at a change of ownership. You must meet the qualifications and have your own fully executed contract before providing or billing for those services; ECS and SBS also need approval from DSHS AFH program staff. (DSHS's list also names Meaningful Day, but HCS Meaningful Day funding ended July 1, 2025.) The Medicaid contract is new too: DSHS starts it the day the new license is assigned, the day after the seller's license closes.
Complete all provider qualifications
You must meet all current DSHS qualification requirements — training, certification, background check, caregiving experience — regardless of the seller's qualifications. The license does not transfer (WAC 388-76-10010). To buy a seven- or eight-bed home, you must already have been a licensed AFH provider for at least 24 months and meet the other conditions in WAC 388-76-10032.
Prepare the home for inspection
DSHS inspects the home on site as part of licensing. Most applicants do not pass the first inspection, and DSHS allows at most three visits. DSHS has confirmed in writing that a home licensed continuously through the sale is held to the rules in place when it was first licensed, so the 27-inch interior door rule for homes licensed after Sept. 20, 2026 does not apply to the buyer. A home whose license has lapsed must meet current rules. Review the current building checklist (DSHS form 15-604) against the home's condition.
Submit a new DSHS license application
Apply through the DSHS BAAU online portal. A change of ownership requires a complete new license application and a new license (WAC 388-76-10105). The current provider may ask DSHS in writing for priority processing to avoid disrupting residents (WAC 388-76-10107).
Work with a qualified real estate broker
AFH transactions involve both real estate and licensing components. Work with a broker experienced in AFH sales who understands DSHS requirements, CHOW procedures, and how to structure the transaction properly.
For Sellers
What Sellers Need to Know
Disclose all limits and enforcements
Limits on the type of residents the home can accept, or on who can provide care, must be posted in the home. DSHS tells buyers to ask the current owner about any ongoing limits or exemptions and any outstanding enforcement on the current license, so expect those questions and answer them in writing.
Understand what transfers — and what does not
The real estate transfers. The license does not, and neither do specialty contracts or the Medicaid contract. Residents decide whether to stay or move. Medicaid residents who stay need no new assessment, but they need new authorizations under the new owner's ProviderOne number. An Exception to Rule follows the resident.
AFH sale price versus residential sale price
A licensed, operating AFH can sell for more than the same house as a residence when the buyer is also paying for the business: occupancy, staff, referral relationships and the home's inspection record. The license and specialty contracts do not transfer, so they are not something the buyer receives. A residential appraisal values the real estate only; value the business separately.
Timing the DSHS process into your sale timeline
You must give DSHS and each resident (or their representative) written notice 60 calendar days before the proposed change of ownership, naming the buyer, the resident's right to decide whether to stay or move, and any policy change that could affect them, such as whether the home will serve Medicaid residents (WAC 388-76-10106). DSHS may waive the 60 days if it grants priority processing. The buyer cannot operate until DSHS issues the new license, and DSHS will not estimate how long that takes.
Featured Professionals
Looking to Buy or Sell an AFH?
You can contact AFH Club's featured Washington licensed broker or certified appraiser directly. Licensed work is done by those professionals through their own practices, and the Find a Professional page lists others who work with adult family homes.
Retiring from operating your AFH? Read the guide to selling the business and the building.
Buying or selling an adult family home?
The business and the building can change hands together or separately. The license never does: the buyer's new license drives the timeline. Ask about your situation before setting a price or making an offer.
Discuss the property, the business, or bothProperty questions go to David Stein, the featured broker and appraiser (eXp Realty), independently of Real Property Planning.
Professional Disclosure
Real Property Planning is an educational and connection hub. It does not provide legal, tax, accounting, financial, brokerage, or appraisal services. Professionals referenced on this site are independently licensed and operate through their own separate businesses. Real estate brokerage services are provided by David Stein, a licensed Washington broker, through eXp Realty. Appraisal services are provided by David Stein through Stein Appraisal. Read the full disclaimer.