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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.
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.
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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