Determining the Fair Market Value of Your Property
Fair market value is the price a property would sell for, considering its highest and best use, if offered on the open market. In circumstances involving eminent domain, fair market value can become a hotly disputed issue.
Competing Appraisals
The government organization or utility company that is condemning a property will get an appraisal by a real estate appraiser. The property owner can also hire an appraiser to get a second opinion. It is not uncommon for the two appraisals to differ greatly.
Loss of Fair Market Value
If a road or a power line is constructed on or near your property, the value of the property is likely to decrease. In most states, juries are asked to determine the loss of fair market value of properties than have been condemned by eminent domain.
In most states, the loss of fair market value is determined by measuring what the property was worth immediately before the taking and what it would be worth immediately after the project was completed.
Factors That Can Reduce Fair Market Value
As a property owner, you are entitled to ask for consideration of other elements that could affect the value of your property after the project is built. Depending on the jurisdiction, these may include:
- Smell: The smell of an ethanol plant, a garbage burner, or a hog farm
- Noise: Including traffic and industrial noise
- Light pollution: A common concern when development infiltrates the countryside
- View: Does a power line obscure the view? Are you no longer able to see the lakefront because of the freeway onramp?
- Stigma: Rational or irrational fear can negatively impact property value.
A property can be stigmatized by a traumatic event that happened on the property, whether that event is true or not. A home that is thought to be haunted and a building in which a murder took place can both be stigmatized. Fear of living next to a high-pressure petroleum pipeline or a high-voltage overhead power line can stigmatize a property and reduce its fair market value.
If you have received an offer for your property from a government agency or utility company, it is important to speak to a lawyer about your rights. Call the attorneys of Fair Compensation at 866-550-7311 or contact us today by e-mail.
From offices in Wisconsin, we represent clients throughout the Midwest and nationwide.
