Valuation
Before and after: the method behind almost every partial taking
Value the whole property before. Value what is left after. Subtract. The method is simple to state and it is where nearly every substantive disagreement in condemnation valuation actually lives.
Worked illustration
The same taking, valued two ways
| Step | Appraisal A | Appraisal B |
|---|---|---|
| Whole property before | 900,000 | 900,000 |
| Remainder after, with project built | 690,000 | 760,000 |
| Compensation (difference) | 210,000 | 140,000 |
| Of which, value of land taken | 140,000 | 140,000 |
| Of which, severance damages | 70,000 | 0 |
| Where they differ | Remainder loses value from reduced frontage and altered access | Remainder treated as unaffected apart from the lost area |
Both appraisals agree on the before value and on the area taken. The entire seventy thousand dollar gap sits in one judgement: whether the remainder is worth less because of what the taking did to it. Figures are illustrative.
Two rules
What the after value must reflect
The remainder as it will exist
Not the remainder as a clean smaller parcel, but the remainder with the project built: the embankment, the pylon, the widened carriageway, the new grade, the changed entrance.
Its own highest and best use
The remainder may no longer support the use the whole supported. A development site reduced below the minimum lot size, or a farm cut in two, has a different highest and best use after than before.
A caution
Benefits, and the rule that varies by state
If the project increases the value of the remainder, states differ sharply on what happens. Some permit special benefits, those unique to this property, to offset severance damages but not the value of the land taken. Some permit offset against the whole award. A few prohibit offset entirely. General benefits shared with the surrounding area are almost never offset.
This is one of the places where the law genuinely differs by jurisdiction and where a general explanation stops being useful. Check the rule in your state before accepting an after value that claims the project made the remainder more valuable.
Questions about the method
What if only a small strip is taken
The method is the same. A narrow strip across a frontage can cause damage out of proportion to its area, by moving a boundary closer to a building, removing parking or changing an entrance.
Does the method apply to a total taking
No. Where the entire property is acquired there is no remainder and compensation is simply the fair market value of the whole.
Can the after value exceed the before value
In principle, where the project confers a substantial special benefit. In practice it is rare, and a report concluding it should be examined closely.
Who decides whether severance damages exist
The appraiser forms the opinion; if the parties disagree, the court or commission decides on the competing evidence. The before and after structure means the question is always framed as a difference between two values.
Get a valuation question answered
If an offer has arrived and the number does not match what you believe the property is worth, the appraisal behind it is the place to look. Start with the pages below.