The eminent domain appraisal process: Getting the full value of your property

If your property is subject to a government taking due to one of the numerous public works projects in California, your number one goal should be protecting your right to just compensation. The law requires the government to pay you the highest value you would receive on the open market for your property. How do you ensure you receive top value? By hiring your own attorney and appraiser.

The government will conduct an appraisal of your property, but the offer they send to you after that appraisal should never be your final number. It is rarely – if ever- top dollar. It is important for anyone going through eminent domain to understand how the appraisal process works.

How the government’s appraisal works

After the government sends you a letter of intent to take your property for a public purpose, it will ask you for a temporary entry permit (T.E.P.) in order to conduct an appraisal on your property. It is a good idea to agree to the T.E.P. Failure to do so can mean an unnecessary court battle and possibly an appraisal of your property based on aerial photographs.

Once it has the T.E.P., the government will send an accredited appraiser to your property. It is a good idea to consult with an attorney before this appraisal takes place. While you will be able to accompany the appraiser on his or her walk around your property, what you say can affect your case – sometimes positively, but also sometimes negatively. That said, you will need to provide information to the appraiser to ensure they do not overlook anything of value on your property. An attorney can help you give the appropriate information without harming your case.

Once the appraisal is complete

Once the government has completed its appraisal, it will send you a written offer to buy your property along with a summary of the appraisal. This summary will include the appraiser’s estimate of your property’s fair market value. Factors that go into determining the fair market value include, but are certainly not limited to:

  • The property’s location and a comparison to similarly situated properties sold recently in the area
  • The property’s use, including any improvements made to it
  • The value of the structures on the property and their depreciation
  • Income the property generates
  • Any environmental issues and zoning requirements

Getting the best value through your own appraisal

The government’s appraiser, while considered neutral, may look for ways to support the government’s bottom line. By hiring your own appraiser, you guarantee neutrality and help ensure you get an appropriate offer for your property.

You do not have to accept the government’s offer, and the government is required to negotiate with you.

In California, there is little risk in hiring your own appraiser. In fact, if you choose an appraiser that has been licensed by the State Office of Real Estate Appraisers, you will be able to request reimbursement for up to $5,000 of your appraiser’s fees.

The process for independent appraisals is very similar to the government appraisal process above. Having an attorney help you choose an appraiser and prepare for the appraisal is always a good idea.

Posted: 08/17/16 Joseph Dzida