If the government exercise “eminent domain” – which means it wants to condemn your property – than it is your duty to receive a fair compensation. It’s practical, it’s the law and it’s your duty and right to get duly compensated. A condemnation appraisal would be necessary and we are an experienced company than can provide one.
A certified appraisal as per guidelines outlined in USPAP – Uniform Standards of Professional Appraisal Practice is the only way to go. This appraisal can be completed for both the homeowner and also the government in order to establish a fair market value.
If the above makes condemnation appraisals sound simple, that’s not the case. There are many legal and procedural issues involved in an accurate condemnation appraisal. A federal condemnation will require a different analysis and report format than a state or local taking. And in any event, the jurisdiction proposing to condemn the property is likely to have its own rules for appraisal that must be followed. It is important to hire an appraisal firm that has experience and training in these types of valuations.
An eminent domain action may reserve certain rights in the property to the current owner. The government may petition to take only part of, or a partial interest in, the property. This requires the appraiser to value the “larger parcel” — the currently undivided, contiguous property — and the “remainder” of the property, or rights to use the property, that will be held by the owner after condemnation and factor that into the overall value of the taken property. For an added wrinkle, it will often be necessary for the appraiser to determine his or her opinion of value on the “remainder” before the taking and after the development or use prompting the taking, because they are likely to be very different.
Likewise, appraisers always consider a property’s “highest and best use” when formulating an opinion of value. For many condemnation appraisals, it is necessary to consider the highest and best use of the property before taking and after the development or use resulting from the taking. Again, it is important to have a professional appraiser with experience and training.
Because an appraiser may often have to testify about his or her condemnation appraisal, it is important that certain steps in valuation methodology — such as selecting and analyzing comparable sales — be performed more thoroughly. You rely on your appraiser to know what’s necessary, so again, it’s important to select an appraiser/company that has experience and training.