Today’s blog post is from one of my Bay Area Eminent Domain Partners, Kara L. DiBiasio. You can learn more about Kara and her practice by clicking on her name.
Many appraisers determine the value of condemned property using comparable sales. But often in partial takings, owners claim a particular feature of the post-condemnation project or use will diminish the property’s value. Examples include projects involving the construction of electrical transformers, cell towers, and gas transmission lines on or near the affected property. Owners often claim the presence of these features will decrease the value of their property in the after condition, thus triggering a claim for severance damages.
In such cases, it may be worthwhile for the appraiser to conduct a paired sales analysis. Unlike comparable sales, where an appraiser considers several properties similar to the subject property, a paired sales analysis focuses on the likelihood of damages from the project by looking at several pairs of properties. Each pair of properties are as close as possible to identical, other than the purportedly detrimental feature. The existence of any significant difference in value between the pairs is indicative of whether the feature being studied leads to a diminution in value. This data can help support the appraiser’s opinion as to the presence, or absence, of severance damages.
If you have a condemnation action that involves severance damages, it is worth discussing with your appraiser whether the impact of a certain feature can be evaluated with a paired sales analysis. Our lawyers have effectively litigated numerous eminent domain cases involving paired sales analyses, and we welcome any questions about their use in condemnation proceedings.