Many individuals are unaware of condemnation in real estate and what impact it would have on their lives, especially in New Jersey.
Just because an individual pays off a mortgage, it doesn’t mean that the property will be theirs forever. This is because they can lose it due to an expropriation. Therefore, those who need help learning about their options should contact our New Jersey real estate attorney.
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Definition Of What Is Condemnation In Real Estate
Under federal law, eminent domain is a lawsuit in which the government exercises eminent domain to acquire private property for public use.
To do this, a court will determine how much the government should compensate the individual for their private property. In addition, the government must use the property to build:
- Road expansion.
- Flood control zones.
- Electrical installations.
- Other public benefits.
This means that the US government has the legal capacity to use eminent domain as a method to acquire real estate and use it for public benefit.
Characteristics Of Condemnation In Real Estate
- It is a process used by the government or private entity to legally acquire a property.
- This process can be used to enforce housing and safety codes for dilapidated or abandoned properties.
- The owners can accept the expropriation or fight against it in court.
- Government authorities can expropriate property through eminent domain to confiscate the homes of their respective owners.
- Eminent domain allows property to be seized for public use. For example, power lines, roads, oil pipelines, railways and so on.
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What Is The Purpose Of Condemnation?
The purpose of condemnation is the legal acquisition of private property by the government. Condemnation can be used for housing and safety code enforcement.
What Happens If Property Is Taken From An Individual?
Pursuant to the Fifth Amendment ‘s condemnation clause , property owners facing condemnation have the right to fair compensation. This compensation is interpreted as full and fair market value.
What Is The Condemnation Law?
The law states that condemnation is when the government exercises its eminent domain powers to seize private property for public use.
- Pursuant to the provisions of Boom Company v. Patterson, the ability to take property is a part of government sovereignty.
- Therefore, governments are subject to constitutional or legal restrictions on how and when to expropriate property.
- Likewise, the government will be subject to comply with the clause of the Fifth Amendment.
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Who Has The Right To Expropriate Property?
United States law provides that only the government (federal, state, local, or municipal) has the ability to take property. These governments may also delegate authority to private agencies to exercise power on their behalf.
An example of this is when you want to build a public infrastructure. Often, the government gives a utility company the power to take private property.
What To Do If I Receive A Notice Of Expropriation?
If the process begins with a condemnation notice, the first thing to do is immediately consult with a real estate attorney. Our eminent domain attorney in NJ is ready to assist their clients in these matters.
Our attorney will be able to help her clients guide them effectively through these processes. Through private property appraisal, you will be better prepared to negotiate with the government.
All this is due to the fact that initial government offers are generally considered insufficient, so a negotiation could be favorable.
Types Of Condemnation In Real Estate
In most cases, the government orders a condemnation of real estate for two reasons:
- The property is not secure, or
- They want to legally take control of the home under eminent domain.
To better understand this, we will explain these types of expropriations below.
The Property Is Dilapidated Or Unsafe
If a property is dilapidated or unsafe to live on, then it may be subject to condemation. At this point, the expropriation has the objective that the occupants or the occupants of neighboring properties do not suffer any type of damage.
- However, a property that may be expropriated for being unsafe may be restored to a state of occupancy.
- Whether the property is unsafe or dilapidated depends on federal, state, and local housing codes and safety regulations.
- Homes can become dangerous due to a lack of maintenance, care and attention, especially after an earthquake or fire.
- In some cases, renovations could also lead to expropriation. This occurs if the New Jersey home inspection for renovations discovers code violations or unsafe conditions.
It is crucial that owners do not ignore condemnation orders, as they could rack up costs or other problems. Owners can rectify the situation and have the orders removed by making the necessary repairs.
In some cases, the property may have to be demolished. Owners who do not agree with this can consult with our attorney Carolina T. Curbelo to determine their possible options.
Eminent domain gives the federal and state governments of the United States the right to eminent domain and seize control of New Jersey real estate title when necessary.
Through eminent domain, the expropriating authority will have to provide fair compensation when taking control of property for public use.
A popular example of eminent domain is the development of interstate highways. It is estimated that the Department of Transportation (DOT) displaced more than 475,000 homes during the development of these highways between 1957 and 1977.
What Is An Example Of Eminent Domain In Real Estate?
A more frequent example of expropriation is when the government decides to build a new highway. To do this, you must demolish several houses to build the highway layout.
However, you first need to acquire the houses that stand in the way without their owners being able to refuse. If this occurs, they will prevent the construction from taking place. Generally, the authorities use expropriation to solve this problem.
- Most of the time, the first offer that the government makes for the property of individuals is known as a “pro tanto award”.
- If individuals believe this offer is unfair, they may hire our attorney to negotiate a higher price.
- Expropriations can sometimes occur on an immense scale. For example, during World War II, approximately more than 20 million acres of land were taken by the government to use defense facilities.
Example Of Condemnation By Abandonment
If an individual inherits a home in another state and looks sloppy for several years, it is possible that the home will eventually suffer some deterioration. As a result, the roof can collapse, the walls rot, and the floors crack.
- This property can be a place where insects or pests proliferate and affect the community. Also, local children could use that house as a meeting place, which clearly would not be safe.
- To avoid these situations, the neighbors could contact the local government to do something with this site.
- The government can issue a notice of condemnation in court. Also, if the property is abandoned for a long time, the government has the right to seize or enter it.
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What Rights Do The Owners Of Homes That Will Be Expropriated Have?
The owner has the right to be notified of a pending condemnation. The vast majority of states require the government to negotiate a voluntary purchase of the property before eminent domain can proceed.
Although owners cannot challenge a taking, usually the amount of compensation offered can be questionable.
- Owners can challenge a condemnation, but they are often more successful in challenging the compensation offered.
- The owner also has the right to consider obtaining an independent appraisal, but the court will consider only current fair market value.
- Note that fair market value does not take into consideration sentimental value, what the owner paid for the property, or any outstanding debts on the property.
Generally, questioning the assessment does not necessarily delay this process. Since most statutes have laws that allow the government to deposit the money to take title and possession immediately, thus avoiding possible delays.
How Will My Property Be Valued?
The home appraisal in New Jersey will be evaluated through several approaches. For example:
- Comparable sales.
Surrounding homes and any other features or enhancements to the property may be tested for fair market value. In addition, it will also take into account how much income the property produces, if any.
What Is The Inverse condemnation Process?
Inverse condemnation is a lawsuit brought by property owners against a private or public interest that has affected or damaged their property or reduced its market value.
- This process usually begins when the property owner has witnessed government-caused property damage.
- Since the damage to the property has already been done, the owners seek restitution for this.
- Generally, the inverse condemnation process can be very difficult to prove, as the agency involved can take steps to minimize any negative impact. This is done to avoid paying the full value of the property.
- An example is that if a railway is to be built, the construction agency will provide the owners with soundproof windows to mitigate the noise.
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Examples Of Inverse Condemnation
An example of inverse condemnation is when a store is located on a busy street. The government has decided to improve and widen the street in front of the store, as this will allow vehicles to navigate better.
- However, by doing so, the expansion will consume the store’s parking lot.
- Even though the city offers to pay fair value for that parking lot, the store owner knows his business will suffer if no parking is available.
- The owner can ask the government for the value of all the land, including the value of their store.
Another example of inverse condemnation is when the government allows or causes extensive pollution that adversely affects an owner’s land or waterways. If so, you can start the process to receive compensation for this.
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Frequently Asked Questions About Condemnation In Real Estate
Although both terms are sometimes used interchangeably, they have a subtle difference. Eminent domain gives the government the power to seize property, while condemation is the actual act of seizing property.
Any federal, state or local government will have this right. However, it can also extend to government agencies such as: The Federal Bureau of Investigation (FBI), the National Security Agency (NSA), the Central Intelligence Agency (CIA) and so on.
Individuals do not have to accept the condemnation offer. However, most of the time where eminent domain is involved, it will be ruled in favor of the government. Still, appearing in court can be advantageous in order to obtain the maximum possible compensation.
Some evaluations include examining non-subjective attributes. This means that it will be a subjective process, where factual assumptions, market data, personal biases and other factors that influence the final estimate are taken.
New Jersey Real Estate Condemnation Lawyers
Now that we have explained what condemnation is, you should know that it is something to prepare for in advance. While government takings do not mean that there will be a hoax involved, a fair market value must be obtained.
Through the appraisal, you can go a long way to ensure that fair compensation is received, whenever the government has ordered a condemnation for the home.
At Curbelo Law we understand how difficult it can be to face a condemnation process, especially if you have lived in or fought to own the home you currently have. So if you do not agree with the expropriation, do not hesitate to call us as soon as possible.