Those who own real property usually have the right to decide when to sell that property to another party. Occasionally, the law does allow government entities to force the sale of a property for the completion of certain projects.
Projects intended for the public good, such as the expansion of a highway, may necessitate the acquisition of multiple pieces of real property. When property owners don’t want to voluntarily sell, state law grants the authority to condemn the property using eminent domain statutes.
Property owners facing the forced sale of their homes through condemnation may worry about losing one of their most valuable assets. If the amount offered is too low, the potential for serious financial setbacks exists. Why might condemning authorities underestimate what a property is worth?
Improvements may not be readily apparent
Factors including the current taxable value of the property and the sale prices of comparable homes nearby influence the amount offered in an eminent domain scenario. Many homeowners make planned improvements to properties as a way of increasing property value.
Remodeling a kitchen or converting an extra closet into a half bathroom can significantly increase what a property is worth. The party condemning the property may not be aware of changes made to the home that could influence its value. A professional appraisal is sometimes necessary to establish what the home is likely worth given the condition of its interior spaces.
Keeping costs low is often a priority
Even government entities planning large projects have to think carefully about budgetary constraints. Offering too much for individual properties to simply speed up the process through generosity can lead to financial strain.
Given that the law only requires offering the fair market value, many entities with the power to condemn a property make the lowest reasonable offer they can. That way, as much of the budget as possible goes to construction and other costs. That desire to keep costs low is in direct conflict with the desire of local residents to receive a fair payout for the involuntary sale of their primary residences.
One of the many possible responses to an eminent domain condemnation effort is to counter the amount offered by proving that it is unreasonably low. Pushing for appropriate compensation can help those facing eminent domain claims move on with their lives after securing fair compensation for the loss of their property.