If the government wants to take your private property for public use, they will have to make a fair offer to buy your land. Unfortunately, you and the government may have different definitions of what is “fair compensation.”
The good news is that you do not have to accept the initial offer. You have the legal right to make a counteroffer and negotiate for fairer compensation.
However, negotiation does not simply involve asking for a higher amount. Here is some crucial information that can guide you through the process.
Appraisal results can help you determine if the offer is fair
The best first step is to analyze the value conclusions and the appraiser’s basis for them. Doing so will help you determine if the initial offer is just.
Consider these factors when reviewing the appraisal report:
- The properties used as comparables: Are they truly similar in terms of location, size, condition and use? Are the sale dates recent enough to reflect current market conditions?
- Adjustments: Look at adjustments made to comparable sales. Ask yourself if they are reasonable enough or well-justified.
- Highest and best use: Verify if the appraiser considered the property’s highest and best use, which may differ from its current use.
Analyzing the appraisal may be difficult if you do not know enough about the process. In that case, consider getting your own appraisal to ensure the offer is fair.
Negotiations require justification and proof
Before you can negotiate with the government, you must be able to justify your counteroffer. That is, you need to have legal justification and evidence supporting the higher valuation of your property.
For example, suppose the government offered $200,000 for your commercial property. However, you have invested $50,000 in renovations over the past two years, and the appraisal does not account for these improvements.
In that case, you can provide justification and proof by presenting evidence of the renovations, along with your own appraiser’s report.
Eminent domain appraisals consider more than your land’s value
In typical loan appraisals, the bank focuses on figuring out the price a property would sell for in a market under normal conditions. On the other hand, an eminent domain appraisal also considers other factors, such as:
- The losses you will incur upon the taking of your land
- Value of easements
- Damages to remaining property if the government only takes a portion of your land
Calculating compensation can be challenging, but it shouldn’t get in the way of fairness. Consider talking to an eminent domain attorney who can help you fight for fair and just compensation.
