Eminent Domain

Definition of "Eminent domain"

Written by

Bill Gearhart

Coldwell Banker Townside, REALTORS®

The United States has a law named “eminent domain” that grants local, state, or federal government the right to take ownership of a private property with or without the consent of the owner. The property is used for the benefit of the community as most often the property is changed into parks, hospitals, expanding roads or highways.

The definition of eminent domain underlines the constitutional Fifth Amendment right that the government has to occupy a private territory, take ownership, and give it for public use. The meaning of eminent domain also specifies that the owner receives just compensation from the government for the property or land.

The government can use the eminent domain law on most types of residential or commercial properties. In some states, however, some limitations are imposed that do not allow the government to take land used for cemeteries, orchards, gardens, or factories through the eminent domain process. In the situation of an abandoned building that is considered unsafe or that is used for illegal activities, the government has the right to take it through a forced sale without just compensation.

Eminent domain can be:

Complete taking is what happens when the government buys all of the owner’s property for public use.

Partial taking happens when the government buys a part of the owner’s property for public use.

Temporary taking occurs when the government only takes the owner’s property for a specific period.

How does it work?

The first step towards the eminent domain process is to condemn the property. The method of condemning a property is not voodoo or spiritism, but a process through which the government notifies the owner of their objective of implementing the eminent domain process.

The eminent domain laws vary for each state, but in most cases, the government’s first step is to try to agree regarding the price with the owner. If they reach a deal, the process is easy; part of the property or all of it goes under the administration of the government for temporary or permanent use. The owner receives the fair compensation agreed upon that is determined by the current real estate market, the income the property produces, or the cost and value of the property by taking into account the expenses required to replace the building.

In case the owner of the property considers the offer unjust, then they can argue against it, leading to a condemnation hearing during which the court has to set a fair price for the property.

What can the owner do?

As you receive the condemnation notification, you probably start wondering if there is any way to avoid the eminent domain process. Firstly you’ll begin the negotiation process with the government for the price of the property. Even once a price is set, you can still contest the amount offered. Doing so will lead you to court, but once you are there, and the court appoints a price, the government will take the property once they pay the set market value for the property.

There may also be situations when your property is affected by the eminent domain process, even if your property isn’t taken for public use. If the government builds a highway and installs a pillar right outside your home, you have the right to request compensation from the government by inverse condemnation.