A decades-long dispute involving the house where Hitler was born took a new turn on Thursday, as a court in Austria ordered the country’s government to pay the former owner of the building the equivalent of $1.7 million.

The Austrian government sought for decades to take over the three-story property in the medieval town of Braunau am Inn, to ensure that it did not fall into the hands of someone seeking to glorify its dark history. It used a compulsory purchase order in 2016 to buy the property for 310,000 euros, or $350,000 at current exchange rates, according to Deutsche Welle — a bargain price for a historic property of its size.

Unfairly so, the district court in Ried im Innkreis, a town in northern Austria, found on Thursday. It ordered the government to pay Gerlinde Pommer, a descendant of the original owners, €1.5 million, precisely the amount she had asked for after having the property appraised.

The state has the right to appeal, but it was not immediately clear on Thursday if it would do so. Neither the Interior Ministry nor Gerhard Lebitsch, Ms. Pommer’s lawyer, responded to requests for comment.

Hitler was born in one of the upper-floor apartments of the three-story house on Salzburger Vorstadt in Braunau on April 20, 1889, and lived there until the age of 3. Though he showed no interest in the property later in his life, it became something of a Nazi shrine during his rule, and a magnet for neo-Nazis long after he was gone.

The Austrian authorities grappled for years with the conundrum that the house presented: Demolish it, and be accused of erasing the country’s troubled history; or maintain it, and risk having the property continue to draw far-right extremists from across Europe.

The government took over the main lease of the property in 1972. It also offered to buy it from Ms. Pommer in 1984, but for three decades, she refused.

In 2014, she indicated that a change of hands might be possible, but talks collapsed two years later because of her “lack of willingness to sell,” according to Wolfgang Sobotka, who was interior minister at the time.

Parliament’s home affairs committee submitted a petition in October 2016 to expropriate the building, offering financial compensation to Ms. Pommer in return. “No other historical property exists in Austria that holds such a special, global and political meaning,” the motion read.

After Parliament approved the measure, which took effect in January 2017, Ms. Pommer filed suit with the Constitutional Court to declare the law unconstitutional. But the court ruled in the Austrian state’s favor.

Even if the decision on Thursday settles the financial terms of the property’s transfer, it does not answer the question of what to do with the property. There have been proposals to have it restored and used to fight Nazi ideology, torn down and replaced with a structure with no links to the Nazi era, or rehabilitated into a center for refugees.

Those questions might be no easier to solve today. Since December 2017, the Freedom Party, founded by neo-Nazis after World War II, has been part of Austria’s coalition government.

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