Further, it creates a legal and financial risk in the entire system where property becomes subject to the whims of whatever governing authority therefore discouraging investment and real ownership.
The Kelo decision was despicable, let's not encourage it.
If land values have truly doubled in 8 years it isn't like the family involved is out of pocket. They've made a small fortune. The idea they can make a small fortune and prevent land from being used is also morally gross. The only justification is that a large hurt is diffuse where the small hurt would be concentrated. That is a defensible philosophy but it is also one where eventually everyone is worse off. And it isn't like this is an erosion of property rights; they are being taxed on benefits that they are not responsible for creating. 1.5% land tax so people have to re-buy the land once a generation is as good an idea in tax law as any I've seen.
I agree that having to change a lifestyle because of taxation is pretty awful and the system should strive not to do it. But I've visited places like Hong Kong and seen the density of living there. We're talking an order of magnitude more people. The number of people who come out ahead from that sort of property development is so overwhelming we can't process it using intuition and positive stories about individuals.
This can be done by borrowing against the house from a financial institution or we can have the government place just place liens on the property if you can't pay.
1) It is a lot more economically efficient, the situation has gone from 1 family living in a desirable area to multiple families. If we ignore the fact that one family had to move that is a big step up.
2) The alternate scenario, where the family just sits in their rapidly appreciating house, is grossly unfair. They are reaping huge benefits without doing anything. It is ok in principle but it is unfair on the other normal folk who can't move in that area and get priced out because there isn't enough housing. This concept is the justification of the land value tax and it goes to a very important principle - benefits should come from either hard work or by taking risks with saved money.
3) Since the economic and social benefits of tearing down single houses and building apartments are so huge (ie, lots of people get to live where they want instead of few people) it would be well worth looking for ways to keep the land value tax and mitigating the effect on the family that has to move rather than doubling down on the idea of people having a right to land. Taxes represent the government taking something people worked to earn. Taxing someone on land and they have to move is not that different from taxing their income and they have to give up some pleasure in life. That is what taxes do.