Road Project acquires my property

[abeerdeen]

Hi everyone,

I recently received a letter from NSW Government advising a possible compulsory acquisition of my property due to road project. It is one of six strata units in the building. Also the project won't commence before 2016, so I think I still have a bit of time to have my exit plan sorted.

I have since looked around the internet, and found out that I need to get an independent legal advice on this matter, and the cost would be covered by the acquiring party. I would also need to arrange a meeting with the acquiring party to clarify the process and so on.

But I thought before I start all that, I wonder if anyone would share their experience in this matter?

Things that I'm not too sure about are as follows.

a. Would it be better for me to go to the negotiation alone or together with other owners (ie. using one solicitor to negotiate as a class action)? I would imagine it would be really hard to have an agreeable offer to be presented to the acquiring party, in terms of timing and price, given that different people may want to move at different times, have different priorities, and value their property differently?

b. Would it be better for me to go in to the deal earlier or later? ie. to achieve the best compensation, should I negotiate early, or wait until right the last minute? Being the first one in the building, middle or the last?

c. Any other negotiation points I need to think about? I've lived here for more than a decade, so relocation would be highly inconvenienced, let alone if I have to move out of the area. Thinking about the stamp duty in my new purchase scares me heaps!

d. Since this is a strata unit, and the entire building will be acquired, are we/am I entitled to the land component of it?

Looking forward to hearing some valuable insights from those who are in the know.

Thanks in advance,
Sam

 

[DaveM]

Have done this before, and am currently the strata plan liason on another complex I own in where the NSW govt is aquiring land the owners corporation owns for the north west rail link.

Best off to do it as a whole group rather than individually. More clout when its all owners working together.

 

[chilliblue]

Have done this before, and am currently the strata plan liason on another complex I own in where the NSW govt is aquiring land the owners corporation owns for the north west rail link.

Best off to do it as a whole group rather than individually. More clout when its all owners working together.

Plus as someone who has been on the government end, it makes their life easier dealing with a group and you stand a better chance.

 

[Ed Barton]

What do govts generally pay in compulsory acquisition? Market value? Slightly above? lower? etc?

 

[Scott No Mates]

What do govts generally pay in compulsory acquisition? Market value? Slightly above? lower? etc?

It depends - the state govt works under one act, the feds under a different act. They are remarkably different in what they can consider.

LAND ACQUISITION (JUST TERMS COMPENSATION) ACT 1991 (NSW)

Read Division 4 as to what you will get.

LANDS ACQUISITION ACT 1989 (Federal)

 

[grand dad]

Well, it happened to me - my land and two houses were compulsorily taken. Many years later, I'm still aghast at the awful way in which I was treated. But I was not the first person to suffer - there are plenty of people who have died waiting for compensation. I personally advocated for a Holocaust victim whose land was taken away in WA back in 1960. 40 years later he had still not been paid. I took him, aged 80, to meet some public servants. They took took delight in giggling and belittling the poor fellow saying things like: "Mate its like if you leave your money in the bank and don't claim it - it then becomes the property of the government. You have no claim against us." It was only after the newspapers took on the story that they finally paid him. The land back then was worth over $1m. They government negotiators started at $7,000 - "this is what it was worth in 1960 and this is what you are getting." After a few months they slowly raised it to $400k and he took the money and went away to die. His whole life was destroyed. He never married or had any kids. Nor did he manage to enjoy the money so late in his life.

OP feel free to PM me if you want info about my personal experiences. Read up about your rights. www.austlii.org is a useful reference point. And beware valuers - they will deal with you just once in your life and won't show you any loyalty. Been there, I feel your pain.....I could go on for hours but its Friday night and I should desist.

 

[Scott No Mates]

The laws in NSW are more modern than that but were originally based on a Public Works compensation of lands act from the turn of the century. Many compensation claims now are resolved very early in the peace but you need to engage a valuer in the first instance not the lawyers. Lawyers come into it if you can't come to an agreement with the acquiring authority and have to go to court.

 

[grand dad]

The laws in NSW are more modern than that but were originally based on a Public Works compensation of lands act from the turn of the century. Many compensation claims now are resolved very early in the peace but you need to engage a valuer in the first instance not the lawyers. Lawyers come into it if you can't come to an agreement with the acquiring authority and have to go to court.

Most valuers are reluctant to rock the boat and usually come up with exceedingly low figures; they deal with clients just once - they deal with the government on a regular basis and produce valuations that are umm overly conservative, designed not to offend.

There is also the issue of "Blight" - land earmarked for compulsory acquisition usually appreciates at a much lower rate than land elsewhere. Most valuers are ignorant of this fact and unable to value accordingly.

The OP should read, read, read and be fully aware of his rights.

 

[RetireRich101]

The Bad,
you can't say NO, unless the Authority change direction and say they don't acquire you property anymore.
your property will be gone at certain date, no matter how hard you fight. The fight is for a compensation/outcome.

The Good,
per Just Terms Compensation they need to provide you Solatium( inconvenient fee), I think to be about $20-25k
They may pay for your storage or removalist, depending on informal negotiation
They may pay for your legal and valuation fee ( I use the word "may" here. Generally they will pay but don't take the solicitor or valuer out for an expensive meal and hoping to get reimbursed)
Unlike a typical bank mortgage valuation, there are 2 side to the argument for valuation. meaning you have the right to get your own valuer and likely be reimbursed.

I been there done, and end up Land & Environmental court with a hearing date in 2014.

The Authority will say we pay you Market value. However they use a Valuers that will try to justify a lower valuation. Believe me this is what really happens.

With strata apartment/units where there a number of comparable sales that can be used, there shouldn't be much discrepancy between the 2 valuers.

My suggestion to you is stay cool, patience, don't think too much and don't get too emotionally attached to the property.

Don't ask question as why can the Government take my property away just like that. It doesn't make sense, but that is the reality. The JTC can take away your property for a public purpose.

Good Luck

Don't be the first to take the offer, but don't be the last with the bag either.

 

[bumskins]

If you think about it, you should end up with a conservative price for 2 reasons:

1) By not going to Auction, you'll never have that exuberance of multiple interested parties pushing the price far above the reserve, that you are often hearing about in the media now.

2) I'm not sure if it's taken into account, but the surrounding homes that aren't acquired may see subdued values.

This would depend a lot on how much 'wow' factor the area or property has. I.e. At Auction someone may pay for that 'wow' factor, but being valued probably not.

 

[norwoodman]

This is for the WestConnex project through inner western Sydney, I'm guessing?

 

[marg4000]

A relative had her house resumed for roadworks (Brisbane). It was under notice for some years.

They decided they would prefer to move sooner rather than later, so contacted the council. Council got their own valuation, owners got their valuation (council paid). They were very happy with the valuations and negotiations proceeded smoothly. They were also entitled to buy another property without paying stamp duty, but as they already had another property they negotiated removal expenses (around $12K but not certain).

If they had wanted to fight the valuations in court it would have been at their expense.

If you think you will make a killing because your property is being resumed you will be disappointed. If you are prepared to accept a fair price then you may be pleasantly surprised at how smoothly things can proceed.

Of course, state laws differ and so do individual circumstances.
Marg