Demolition can be an emotionally and financially draining experience. Generally, the foundation of any destroyed property must be depreciated for land, which can not be depreciated on its own. But recent changes to the physical property laws offer a potential opportunity for the owner to retain some of the value of the property after demolition is completed. In general, all demolition is subject to the same standards. There are a few exceptions, however. In most cases, the value of property damaged by a large-scale demolition project is equal to or greater than the value of the land. The amount can be more than the difference between the amount of money paid as costs and the amount of money paid as profits to the contractor.
The standard for the property that is torn down depends on several factors, including the size and condition of the property and whether it was vacant, new construction, or old property. Many local governments will require demolition to be performed by a licensed demolition contractor to guarantee that the property will be safe. Most contractors will only take over if they are satisfied with the work. The local government is more concerned with the safety of the public and does not want a demolition company to tear down a new structure that does not have the capability to stand on its own.
While the government may be willing to assist in protecting a vacant property, most contractors will agree to only demolish old buildings. New construction or buildings that do not fit into a historic district usually will not be required to be demolished by the local government. However, there are some exceptions. For example, a developer may be permitted to build a new construction or rental home on a site that would otherwise be used for demolition. Demolition in this case is not required and is usually avoided. In the event the demolition of a new building is required, it should be the builder’s responsibility to pay the local government’s share of the costs. In many cases, demolition companies will work in conjunction with the city or state to meet these requirements.