Compulsory Purchase – Appropriate Compensation

When a compulsory purchase order is made, the acquirer must make a fair valuation of the property being acquired so that appropriate compensation can be paid.In making the valuation, all relevant circumstances have to be taken into account.When a house in Newham was acquired by the Borough by compulsory purchase, the Council's valuer referred to three comparable properties in setting his valuation at £300,000. However, the valuer also took account of the poor condition of the property and reduced the valuation appropriately.The owner of the house estimated its value at £420,000, which the Lands Chamber found was unsupportable. The Chamber held that the correct valuation was the amount the property would be expected to sell for on the open market. The house was not in good condition. Any purchaser would have to spend money on it and the valuation should therefore be adjusted to reflect this.For advice please contact Bill Duncan on 01752 292362

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