Eminent domain is the process by which the government can take private property for public use. For instance, the government may be building a railroad, an interstate, a hospital or a military base. If it is determined that the project is good for the public overall, the government may be able to take private property to facilitate the completion of that project.
However, one of the stipulations with eminent domain is that the government does have to pay fair market value for the property. They can’t just take it. They are allowed to force the sale – meaning the property owner may not have wanted to sell but may have to do so anyway. But it is still a sale, and that owner should be justly compensated.
The rise in home prices
However, in the last 10 years, home prices have risen dramatically. Many people have seen their homes double or even triple in value.
This can be problematic for eminent domain negotiations. On one hand, homeowners may simply disagree about what fair market value looks like. They may believe their home is worth far more than what the government is offering.
But another problem is that the property owner may see that property as a long-term investment. If home values keep going up, they may think that the property is going to be worth two or three times as much in the future. Even if they sell it for the going rate today, they may still feel like they are losing money because they wanted to sell it in 10 or 20 years.
All of this makes eminent domain situations very complex. Be sure you understand your legal options.