Under what condition is a landowner entitled to compensation for a change in zoning?

Study for the California Real Estate Broker Exam. Utilize flashcards and multiple choice questions, each with hints and explanations. Prepare efficiently and effectively for your licensing exam!

A landowner is entitled to compensation for a change in zoning when all practical economic use of the property is denied. This situation typically arises in cases where a zoning change effectively renders the property unusable for its intended purpose—such as when a property that was zoned for commercial use is changed to a designation that does not support any viable economic activity.

The rationale behind this principle is rooted in the idea of "regulatory takings," where a government action—like a zoning change—effectively deprives a property owner of the use or economic value of their property without compensating them. If the zoning change eliminates all reasonable use of the property, the landowner can argue that this constitutes a taking, and they are thus entitled to compensation, as their property rights have been infringed upon.

The other circumstances mentioned do not automatically justify entitlement to compensation. Improving property value or selling land at a loss do not equate to a loss of all reasonable use, and simply changing zoning to residential may not affect a landowner's rights to use their property in an economically feasible way. Therefore, the correct condition for entitlement to compensation centers on the complete denial of practical economic use of the property.

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