As many are watching unfold, we’re getting a crash course in what are the governments power over private property. The government wall aggressively pursued by the federal government will be an unprecedented government take over of private property on a scale we have not seen in recent history.
There are four main government powers over real estate:
Taxation
Real Estate is charged to pay for services private by the government. The government accesses the market value of your property at its highest and best use, and cost you a percentage of that value every year. Owners can deduct losses in a variety of ways, hire an excellent real estate accountant.
Escheat
This event occurs when property converts to state ownership when a person dies without a will and heirs. The idea has a recognized owner, the government if no other person claims ownership exists. Escheat is typically done on a revocable basis, allowing it to revert to a lawful heir if they arise. The laws around this vary from state to state.
Empowerment Zones
Economic Development is designated to specific areas the government has drawn lines to determine. EZs are typically economically distressed areas. These areas will be lifted out of poverty by stimulating business enterprise and creating jobs. (Long Island City say goodbye to Amazon).
Eminent Domains
This event gives the government the power to condemn private property for public use or purpose. Just compensation must be paid for that property taking. The “Wall” between Mexican and America will have some areas where private owners will not want to give us the rights to their property; the federal government would have to go through a legal proceeding to accomplish an eminent domain taking their property rights as needed for the wall.
The government has what is called “Police Powers.” Which comes from the 10th amendment to the constitution, gives states the rights and powers to “not devaluate to the United States.” States are granted the power to establish and enforce laws protecting the welfare, safety, and health of the public.
It will be fascinating to see how things play out in American politics in 2019.
