If the eminent domain procedure is deemed valid, the only question remaining is fair compensation. The government or entity attempting to take property must give the property owner fair compensation. In most cases, the government will conduct an appraisal and use that as the basis for its offer.
If the government and property owner cannot arrive at a mutually acceptable fair value, the question of fair value goes to the courts.
Note, however, that there is often more involved in determining fair compensation than just market value. Transition costs can also be factored into this equation. For example, a factory's property may be worth only $50,000 because it is in the low-value part of town; however, when you consider that it would cost the business more than $300,000 to move all of its equipment, that relocation cost must be considered.
In many such situations, the government will often bring in relocation specialists and real estate agents to assist the property owner in finding a new location.
Was this article helpful?
Discover the Jealously Guarded Insights of Real Estate Tycoons and Hot Dealers! Back in the days of the wild, Wild West, when easterners traveled across this vast country looking for opportunity in the newly opened territories, they were often referred to as a ‘tenderfoot’.