Eminent Domain and Fair Market Value in a Depressed Real Estate Market (2014) / Chapter Skim
Currently Skimming:
Pages 15-25
The Chapter Skim interface presents what we've algorithmically identified as the most significant single chunk of text within every page in the chapter.
Select key terms on the right to highlight them within pages of the chapter.
From page 15... ...
15 Island,155 Justice O'Connor stated in a concurring opinion that [t] he concepts of "fairness and justice" that underlie the Takings Clause, of course, are less than fully determinate.
|
From page 16... ...
16 should be considered in determining just compensation.162 The Oregon DOT reported that in one of its circuit court cases, the issue of "normalized value" was argued but that the court excluded the appraisal theory at trial. However, "[s]
|
From page 17... ...
17 however, abandoning the underlying and accepted rules of valuation.176 On the other hand, some legal commentators have argued that it is both inappropriate and unlawful to consider the value of the property in a depressed real estate market, for the simple fact that the property owner would not have voluntarily sold the property in such a market. In a down real estate market, a property owner who had no compulsion to sell would simply retain the property until real estate prices leveled out or increased, or the owner might borrow against the property if in need of liquid assets (i.e., cash)
|
From page 18... ...
18 Indeed, the court's rules for determining valuations at a time of extraordinary economic circumstances when "there is no real market as of a particular date" required a finding of value that excluded conditions that could produce a value that is too low or too high.188 The Court of Appeals stated that "‘[f] air market value' means neither panic value, auction value, speculative value, nor a value fixed by depressed or inflated prices.
|
From page 19... ...
19 with the requirement that property must be valued as of the date of its taking for a commissioner to decide not to consider speculative value or a market that was not "normal" and not error for a commissioner to define a normal market as one that is neither "depressed" nor "inflationary."198 The commissioner had considered the market at the time of the taking to be inflationary or speculative because of "federal activities in the Richmond area…."199 The Virginia court quoted an Oregon case, Public Market Co.
|
From page 20... ...
20 of the purchase, courts will allow [evidence of] purchase price paid."208 E
|
From page 21... ...
21 market.216 Utah also stated that its policy was not to include sales that were not conducted at arm's length.217 Sales at auctions may not necessarily be evidence of market value. In Tremblay v.
|
From page 22... ...
22 rate of return…."231 The court agreed that "[c] ost, reproduction cost, and use value constitute evidence which may be considered in determining fair market value."232 However, the court held that "[t]
|
From page 23... ...
23 departments reported that their ability to value properties had been affected by such interventions or actions. For example, Arizona stated that its ability had been affected "to the extent government regulations force banks to sell REO property without market exposure."244 4.
|
From page 24... ...
24 There are four occasions when the project influence rule may be asserted. The first occasion is when "the improvement's exact location is known from the outset, the property that will serve as the site of the improvement will not be subject to any rise or fall in values."252 The second occasion is when the location of a project is unknown.
|
From page 25... ...
25 The Colorado Court of Appeals affirmed the trial court's application of the rule.261 The Fowler court explained that the rule promotes fairness in valuing property by preventing a windfall to the property owner based on speculative potential enhancements in value while, at the same time, protecting the property owner from the injustice of assessing against it a diminution in the property's value caused by the same project for which it is being taken.262 The Fowler court observed that regulatory actions that affect the value of a property as a result of the project, "such as rezoning or the imposition of use limitations" may not be taken into account when determining the value of the property.263 In Missouri Highways and Transportation Commission v. 1811 North Broadway, LLC,264 the court held that "[i]
|
Key Terms
This material may be derived from roughly machine-read images, and so is provided only to facilitate research.
More
information on Chapter Skim is available.