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If beach front property assessments in Florida are anything like farmland assessments in the Midwest, such a valuation might not be completely ridiculous. Around me, pretty much all farmland is assessed at $1,500–$2,000 per acre, even though land hasn’t sold for that since the 1990s. One large farm near me recently sold for $20,000 an acre, but the assessed value is only $1,931 an acre. No farmer would (or should) get in trouble for valuing his land at 2023 rates, no matter what the assessor thinks. I’m not saying Trump’s properties are definitely the same, but it doesn’t seem immediately ridiculous to assume they might be.
Ok, but did the Trumps produce evidence that properties in the area often sell for 10x their assessed value? And you are ignoring the reference to the claimed value ignoring the restrictions on development. That is pretty bad, if true.
Regardless, remember the point is not that the judge is correct; it is that the claim that his decision can only be the result of corruption or ignorance does not seem to be consistent with the facts.
Trump shouldnt have to. The state needs overwhelming evidence. Fraud where no bank lost money should lose as a matter of course.
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I’m typing this on my phone, so I’m not going to mess with links.
First, the county assessor lists Mar a Lago’s market value as $37 million. If it’s true that the judge valued it at $17–25 million, there’s already a major discrepancy. It’s worth noting that Trump paid $12 million for it in 1995, equivalent to $24.3 million today. For the property to be only worth $25 million, the judge has to assume that property values haven’t risen faster than inflation, which seems awfully dubious from where I sit. He also has to assume that the county assessor overvalued the property by 1.5–2.2 times its actual worth, which is interesting given his complaint that Trump has been overvaluing his property. Perhaps he felt the best way to compensate for Trump’s overvaluation was to opt for a noticeable undervaluation?
Secondly, some neighboring properties’ asking and sale prices are instructive. 168 King Rd. (4,874 sq. ft., not ocean-front) just sold for $14 million, against an assessed value of $4.1 million (and a market value of $8.4 million; I’m not clear what the difference between the two is). Another nearby property (500 Regents Park Rd—6,488 sq. ft., ocean-front) is listed for sale at $40 million, against an assessed value of $6.4 million ($12 million market value).
Mar-a-Lago’s main building, by contrast, is 37,414 sq. ft. The property also contains five more buildings, two pools, and five tennis courts, to say nothing of the land. That it’s all worth a measly $17–25 million doesn’t pass the smell test.
Wealth inequality has increased vastly more than inflation and things like Palm Beach estates are limited in supply and the people who buy they have vastly more wealth.
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The judgement takes its numbers from the county assessor:
Possibly you're comparing the current valuation to the valuation in the relevant periods?
I also don't think you can reasonably use neighbouring properties prices as a guide to Mar-a-Lago's value when Mar-a-Lago has very different land use restrictions applied to it.
I know you aren’t from the states so you likely don’t have this local knowledge. Property tax values are untethered from actual FMV. The system isn’t designed to determine the real value of property. If you look at real estate, it is often sold well above the assessed property tax value. Indeed in many places even after a sale establishes fmv the property taxes don’t reset the valuation.
Also, land use certainly affects valuation. If Trump tried to sell MAL what do you think he’d get?
I don't have any real idea what it's actually worth. I was initially sceptical of this assertion that property tax values are different from actual values, but it seems legit, so - weird way to run a country, but ok.
But since we're abandoning that as an anchor, we don't have any actual numbers to work with. There doesn't seem to be an actual fair market value appraisal included in any of the court documents. So what we have is a highly unusual property with highly unusual use restrictions. It's very difficult to know what it's actually worth.
Fortunately, I don't think it's necessary to generate an accurate valuation to be able to determine that Trump's valuation was fraudulent. The fact that the 1) use restrictions exist, 2) they are inevitably going to impact the value significantly, and 3) that Trump's valuations assumed they did not exist is enough to satisfy both the judge and myself that he did the wrong thing.
The tax assessment thing is very odd. I learned a lot about it when I bought my house and realized it’s insane.
But I’m not sure your assessment of Trump’s valuation is fraud is accurate. It seems — solely from the comments here — like the judge is making a factual conclusion about the value of MAL and therefore saying Trump didn’t account for the land use restrictions and is fraudulent. Perhaps the judge is simply wrong re value? Citing to the assessor makes me think the judge is just wrong.
Again I think Trump would only be fraudulent is if he told the lenders there was no land use restriction.
He's not. He does cite the county assessor's valuation, probably foolishly, but the argument is not "The valuation is above the county assessor's valuation, therefore the land use restrictions were not accounted for, therefore fraud". The argument is "we have Trumps's SFC statements, they don't disclose the land use restrictions, therefore fraud".
One I’m not sure there is a duty to disclose a publicly knowable fact. Second, was there an assessment report provided by Trump that stated the value or did Trump merely write a value? it isn’t clear from what you said but it sounds like the latter which means the judge is saying he doesn’t think the value was right because he doesn’t think it properly corrects for land use.
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The issue is not "is the judge's valuation correct?" (In part because the judge did not make a factual finding; that does not happen on a motion for summary judgment) It is whether the judge's finding that the undisputed facts show that the value claimed by Trump was higher than the actual value is so unreasonable that it can only be the product of corruption or stupidity.
And, the problem with your discussion of the amount the Mar A Lago "should" have appreciated, is that, as the court emphasizes, subsequent to Trump's purchase, substantial land use limitations were attached to Mar A Lago. Which obviously is going to reduce the value of the property. Note also that the decision says that from 2011 to 2021, the assessed value of the property ranged between $18 million and $27 million, which is indeed substantially more than inflation (the BLS inflation calculator tells me that $18 million in Jan of 2011 was equivalent to just under $23 million in Dec of 2021)
Edit: Note also that Trump's attorneys were free to submit evidence that the County's assessment was inaccurate. Did they? There is no evidence that they did.
And while 500 Regents Park Rd might be listed at $40 million, Zillow tells me that it sold in March of 2020 for $7.5 million, compared to its assessed value of at the time of $3.2 million. And that is the relevant time period: The time when Trump et al filed documents claiming what Mar A Lago was worth (again, the decision says that the time period in question was 2011-2021).
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On the Palm Beach property I’m knowledgeable to yes the result is corruption or ignorance or just trying to give the redditors a partisan talking point. There isn’t even plausible deniability here.
Even if Trump can’t subdivide it’s certainly worth more than sfh with 2 ocean front acres which are trading 200 million plus. The family buying that plot would buy Mar for 200 and just have 15 extra acres.
You might not be able to get the full value of 20 acres which is probably over a billion but it’s certainly worth more than the highest sfh in the neighborhood which gives a lower bound of probably 250 million.
Another user said he bought it for $12 million. That was in 1985. Per the West Palm Beach home price index the value in 2021 would be expected to be about $57 million. Yet he claimed it was worth more than $600 million at the time. A judge who infers therefrom that he was lying is not acting unreasonably. Even if he turns out to be mistaken.
So, you think the judge ruled as he did in order to give the redditors a partisan talking point??
Per this article, he bought it for $5 million.
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That’s not Palm Beach especially the good area or waterfront of which there is very limited supply.
Yes I do believe the judge did this for Reddit talking points.
And it would have been very easy for Trump, et al, to look at property records in the area and show that prices indeed increased fifty-fold from 1985 to 2021. Did they do so? There is no evidence of that. And if they didn't, then what is the basis for claiming that the court decision is meritless?
Thank you. That is very valuable information.
He did do that he presented expert testimony for higher valuations
According to the decision, he did not, because the expert opinion did not include any facts. As the court said, under established law, "Where the expert's ultimate assertions are speculative or unsupported by any evidentiary foundation, however, the opinion should be given no probative force and is insufficient to withstand summary judgment." Diaz v New York Downtown Hosp., 99 NY2d 542 (2002). Had the expert said something like, "I reviewed sales records for nearby properties since 1985 and found that they had appreciated an average of 50x, so I estimate that Mar A Lago was worth Y dollars at the time in question, then there would be cause for complaint. Did he say that, or anything similar?
It’s past my legal ability but for market value purposes a top broker in the market would seem to be a reasonable expert witness.
That being said (and I’ve edited my top post) I wouldn’t quote this judges reasoning. He’s made shit up before and been reversed.
Here’s a quote:
“He said, “You can’t just do this because the zoning allows it. I just can’t believe this is the case.”
Alas for Engoron, it was the case — so the higher court reversed him. “
So in the past he’s admitted a developer was doing something “legal” and ruled against him anyway.
https://nypost.com/2023/09/27/mar-a-lago-judges-developer-hating-past-is-a-big-win-for-donald-trump/
The $25 million figure isn’t even used in the prosecutors brief. They use better arguments some of which may be correct (I think trump may have been overvaluing 50%).
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Those homes don't have land use restrictions that they can only be used as social clubs.
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