Eminent domain refers to the process by which the government may seize private property with proper compensation, but without the owner’s consent. The Fifth Amendment to the Constitution stipulates:
- that the property must be claimed for “a public use;” and,
- that "just compensation" must be provided to the property owner.
In order to claim eminent domain over a property for the purposes of economic development, the government must establish that the property is “blighted."
None at this time.
What is the fundamental issue?
The Constitution provides the federal government eminent domain authority to take private property, as long as the taking is for a "public use", and "just compensation" is provided to the property owner.
I am a real estate professional. What does this mean for my business?
Used carefully and judiciously, the power of eminent domain can help communities invest in projects that are necessary for them to function effectively, such as roads, bridges and water management systems. These kinds of projects help preserve property values and create the conditions for robust economic growth.
Improper or incorrect use of eminent domain can harm property rights and destroy trust in public institutions.
NAR supports eminent domain authority only for a public use (e.g., ownership by a public entity), as well as a broad interpretation of "just" compensation, to include all reasonable and necessary costs which result from exercise of such authority, not just the value of the property condemned. States, not the federal government, should establish their own rules and laws governing eminent domain. Governments must also show evidence that projects have a reasonable chance of being created if eminent domain is used to take private property.
NAR is active in an on-going, broad-based coalition of financial, banking and real estate organizations, closely monitoring all developments in this area and will mobilize when circumstances warrant.
Land Use, Property Rights and Environment Committee