Have you ever wondered what would happen if the government had big plans for road expansion, airport development or another project and your house was in the way? It's not a situation that many families have to deal with, but select individuals will encounter the process of a government negotiation for land. When they do, they need to be prepared. Even if you have visions of refusing the sale or chaining yourself to the property to stop the bulldozers, if the government wants your land there is no saying no. (If you are selling your home and need some assistance, read 7 Things To Consider Before Selling Your Own Home.)
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While the power of eminent domain entitles the government to take the property that it needs, as long as it's for the good of the public, the constitution allows you to request reasonable payment for the land, which means you should save your energy for fighting for what you see as reasonable.
Reviewing the Government-Sponsored Appraisal
When the government decides it needs your land for its projects, you will be notified of the intent by mail.
The government may even send an agent out to talk to you. Before any kind of offer is made, the governing body will arrange for an appraiser to visit your land and fill out a form with information about the size and condition of your property. The appraiser will also outline the land's current zone, use, location and accessibility. You will be given a copy of the appraisal and since it will weigh heavily in the final offer you are given, careful review for accuracy is important.
Negotiating a Better Price
Often, a property owner will be in a good position to bargain with a government-sent negotiator for more than the initial amount offered, especially if he or she has the support of other neighbors whose homes are also needed for the project. A professionally obtained lawyer or negotiator may also be a good person to have fighting your battle for more money. Once you have agreed on a price, you may be asked to sign a waiver that prevents you from suing if you find out that another land owner was offered more money.
(For more on negotiated on a home, check out 10 Tips For Getting A Fair Price On A Home.)
If you cannot agree on a price, the situation escalates to a condemnation proceeding during which you can contest the sale, present your idea of a fair offer and dispute the scope of the land the government says it needs. It's possible that you may be able to prove that the government doesn't need as much land as it's estimated, that the appraisal was inaccurate or that the use of the land is not clearly for public good.
If the government is buying your land you can expect that it will eventually get rezoned from residential or agricultural to a zone that is better suited to the project that it has in mind. The way that your property is initially zoned can have an effect on the price you are offered because land that produces an income (and is zoned accordingly) has a much greater present and future value.
The Bottom Line
In most instances, the sale of your land to the government for a project that will benefit the public is irreversible.
Once it's done, you have no say over how the property is developed. Whether it's used to create new gas lines, build a school or build expensive condominiums in order to raise property values and, as a result, property tax revenues, it's out of your hands. The time to exert what power you have is before the deal is signed, so make sure to take your time and assert your rights before you give up that property. (To help you determine the value of your home, see Top 4 Things That Determine A Home's Value.)