Notice and offer
An offer is a conclusion. Ask for the reasoning.
The letter gives you a number. The appraisal behind it gives you every judgement that produced the number, and that is the document worth reading.
Anatomy
What an offer package usually contains
The offer letter
States the amount and often a response date. On federally assisted projects it must be accompanied by a written statement of the basis for the offer.
A summary of the taking
A plan or description of what is being acquired: area, interest, and any easements or temporary areas.
The appraisal or a summary of it
This is the document that matters. If you have been sent a one page summary, ask for the full report.
Agreement and conveyance documents
What you would sign. These deserve reading as carefully as the figure, particularly the easement terms.
Testing the number
Six questions to ask of any offer
| Question | What a weak answer looks like |
|---|---|
| What is the valuation date | Unstated, or the date of inspection rather than the date fixed by law |
| What use was the property valued for | Current use assumed, with no consideration of anything else |
| Is this a partial taking | A single figure with no before value and no after value |
| What about damage to what I keep | Severance damages stated as none, with no analysis |
| What is the land itself worth, separately | Not separated, so there is no way to see what is being paid for damage |
| Does it include my buildings, fixtures and improvements | Silence, or a lump sum with no itemisation |
A useful reframing
The offer is not an assessment of your property
It is an opening position in a negotiation, supported by one professional opinion obtained by the party that wants to buy. That is not an accusation of bad faith. Agency appraisers are generally competent and are bound by the same professional standards as anyone else.
But an appraisal involves judgement at half a dozen points, every judgement has a range, and an appraiser working for a buyer who sits at the lower end of each range produces a defensible report and a low number. Nothing improper has happened and the figure can still be well short of what the property is worth.
The way to test it is to read the reasoning, and where the reasoning is thin, to get a second opinion. Reading an appraisal report covers how to do that section by section.
Questions about the offer
They will not send me the full appraisal
Ask in writing and keep the request. In federally assisted acquisitions a written statement of the basis for the offer is required, and many states impose a similar duty. A refusal is unusual and rarely helps the agency later.
The offer expires in fourteen days
Most such dates are soft. An agency that needs your property will keep talking. Confirm the position in writing rather than acting on a verbal warning.
Is the first offer always low
Not always, and small acquisitions on well run projects are often fairly priced. It is reliably an opening position, which is a different statement.
Can I accept part of the offer and argue about the rest
Sometimes. In quick take states a deposit can often be withdrawn without giving up the right to seek more. Check that in your state before withdrawing anything, because in some places it does waive rights.
Not sure what to do next
Most owners are reacting to a document they did not expect. Working through it in order is easier than it looks.