Comprehensive Representation In The Field Of Energy Law

3 factors that can influence property value during condemnation

On Behalf of | Oct 19, 2024 | Eminent Domain |

Condemnation is the legal process wherein state authorities, and those completing projects for the public, acquire real property. Owners may have no choice but to sell in scenarios where there are large-scale projects underway for the public benefit.

Those who refuse to sell voluntarily may end up in court facing condemnation proceedings. In some cases, property owners can avoid condemnation by asserting that the project is not really for public benefit. Many times, their best option is to question the offer made for their property.

Eminent domain laws require that property owners receive a fair market value for real property acquired for a public project. Property owners can sometimes prove that an offer is far too low and obtain more reasonable amounts of compensation for the forced sale of their property.

What factors might influence the fairness of a price offered?

The strength of the local market

Real estate markets have seen a significant increase in property values over the last few years. Prices can shift from one month to the next even between to adjacent neighborhoods. When looking at the right price to set for a property, one of the factors real estate professionals consider is the sale price of comparable homes nearby in recent months. If a review of recent sales data indicates that the condemning authority undervalued the home, it may be possible to counter the offer with one based on recent sales figures.

Significant property improvements

When there are houses, barns and other edifices on a property, those structures contribute significantly to the overall value. Even if the project requires the demolition of those buildings, the owner should receive compensation based on what the property would be worth if they sold it as is. Certain renovations to the interior of a home could substantially increase the fair market value. Condemning authorities are often unaware of the interior condition of a home and may undervalue it as a result.

Mineral resources

Sometimes, the condemnation process occurs because of mineral resources such as oil and gas deposits nearby. Other times, condemning authorities may not have considered the value of what lies beneath the surface when making an offer on the property. Property owners may have had the option of extracting oil and gas or signing leases that could have provided them with regular income for years. Evaluating the value of oil and gas resources can help property owners counter unfairly low offers during eminent domain proceedings.

Obtaining a fair price when facing an eminent domain condemnation is one of the only forms of recourse available to real property owners. Those who question an amount offered for their properties may need help countering a low offer and preparing to present their case in court. Thankfully, personalized legal guidance is always available.

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