MKAnnotationView subclass to implement lift and drop animations for your custom map pin. Use this in exactly the same was as MKPinAnnotationView or use the implementation in conjunction with your existing MKAnnotationView subclass.

DPAnnotationView.h

#import <MapKit/MapKit.h>

@interface DPAnnotationView : MKAnnotationView

@property (nonatomic, assign) MKMapView *mapView;

@end

DPAnnotationView.m

#import "DPAnnotationView.h"

NSString *const DPAnnotationViewDidFinishDrag = @"DPAnnotationViewDidFinishDrag";
NSString *const DPAnnotationViewKey = @"DPAnnotationView";

// Estimate a finger size
// This is the amount of pixels I consider
// that the finger will block when the user
// is dragging the pin.
// We will use this to lift the pin even higher during dragging

#define kFingerSize 20.0

@interface DPAnnotationView()
@property (nonatomic) CGPoint fingerPoint;
@end

@implementation DPAnnotationView
@synthesize dragState, fingerPoint, mapView;

- (void)setDragState:(MKAnnotationViewDragState)newDragState animated:(BOOL)animated
{
    if(mapView){
        id<MKMapViewDelegate> mapDelegate = (id<MKMapViewDelegate>)mapView.delegate;
        [mapDelegate mapView:mapView annotationView:self didChangeDragState:newDragState fromOldState:dragState];
    }

    // Calculate how much to life the pin, so that it's over the finger, no under.
    CGFloat liftValue = -(fingerPoint.y - self.frame.size.height - kFingerSize);

    if (newDragState == MKAnnotationViewDragStateStarting)
    {
        CGPoint endPoint = CGPointMake(self.center.x,self.center.y-liftValue);
        [UIView animateWithDuration:0.2
                         animations:^{
                             self.center = endPoint;
                         }
                         completion:^(BOOL finished){
                             dragState = MKAnnotationViewDragStateDragging;
                         }];
        
    }
    else if (newDragState == MKAnnotationViewDragStateEnding)
    {
        // lift the pin again, and drop it to current placement with faster animation.
        
        __block CGPoint endPoint = CGPointMake(self.center.x,self.center.y-liftValue);
        [UIView animateWithDuration:0.2
                         animations:^{
                             self.center = endPoint;
                         }
                         completion:^(BOOL finished){
                             endPoint = CGPointMake(self.center.x,self.center.y+liftValue);
                             [UIView animateWithDuration:0.1
                                              animations:^{
                                                  self.center = endPoint;
                                              }
                                              completion:^(BOOL finished){
                                                  dragState = MKAnnotationViewDragStateNone;
                                                  if(!mapView)
                                                      [[NSNotificationCenter defaultCenter] postNotificationName:DPAnnotationViewDidFinishDrag object:nil userInfo:[NSDictionary dictionaryWithObject:self.annotation forKey:DPAnnotationViewKey]];
                                              }];
                         }];
    }
    else if (newDragState == MKAnnotationViewDragStateCanceling)
    {
        // drop the pin and set the state to none
        
        CGPoint endPoint = CGPointMake(self.center.x,self.center.y+liftValue);
        [UIView animateWithDuration:0.2
                         animations:^{
                             self.center = endPoint;
                         }
                         completion:^(BOOL finished){
                             dragState = MKAnnotationViewDragStateNone;
                         }];
    }
}

- (UIView*)hitTest:(CGPoint)point withEvent:(UIEvent*)event
{
    // When the user touches the view, we need his point so we can calculate by how 
    // much we should life the annotation, this is so that we don't hide any part of
    // the pin when the finger is down.

    fingerPoint = point;
    return [super hitTest:point withEvent:event];
}

@end