kdsA Gilded Age dream crashes down in Tupper Lake
The New York Times has a fascinating profile of Nick Martin, who owns property in Tupper Lake and taught for awhile at Paul Smiths College.
Martin inherited more than $10 million from his father, but the recession and the housing collapse triggered his family’s financial fall from grace.
Now scraping out a living in Kansas, Martin’s new existence is “a far cry from the life that Mr. Martin and his family enjoyed until recently at their Adirondacks waterfront camp at Tupper Lake, N.Y.”
Their garage held three stylish cars, including a yellow Aston Martin; they owned three horses, one that cost $173,000; and Mr. Martin treated his wife, Kate, to a birthday weekend at the Waldorf-Astoria, with dinner at the “21” Club and a $7,000 mink coat.
After pouring $5.3 million into the Tupper Lake property, Martin planned to move there full time with his family.
Then came the financial crisis. The markets plunged, as did the value of the Martins’ trust. By fall 2008, with much of the family’s net worth tied up in housing, Mr. Martin faced a series of margin calls.
…
The family ultimately put the Adirondacks property on the market for $4.9 million, then quickly slashed the price by half. Last month, the Martins got an offer for just half of the latest $2.5 million asking price.
They have stopped making payments on their $1.1 million mortgage and their $53,000 in annual property taxes in the Adirondacks…
It’s a painful story and has painful implications for Adirondack communities, which have relied on high-flying property-tax appraisals, and the construction jobs of a second-home boom, to drive their economies.
Tags: adirondacks, economy
Hate to say this but it happens again and again in the Adirondacks. The Adirondacks have always seen more millionaires having their dreams destroyed than made up here.
This is an example of the stated goal of Obama:
“I believe in returning the nation’s wealth to its rightful owners.”
I guess you call this an Obama success story.
Just because it happened here, doesn’t make it uniquely Adirondack either.
I’d like to know more about falling property values. Are local assessments falling at the same rate? And the related tax revenue?
@jdm I’m sure there are some that actually do celebrate the downfall of a wealthy person. I don’t celebrate, but I also find it really hard to sympathize with the loss of an Aston Martin.
Greed, gluttony…
Well, JDM, perhaps you can take some comfort from the Nov. 23rd NYT’s report that corporate profits last quarter were the highest in the 66 year history of Dept. of Commerce record keeping. As unemployment remains near 10%, programs to support ordinary Americans are being slashed, and the wealth of billionaires protected from mild taxation, I would call this the real Obama success story.
But the greed is just as much with the over assessment of properties to cash in as it is with this guy who happened to inherit some money.
One of the blessings this area has is that it never experienced the “boom” places like Vegas, Florida, etc. had. Our “boom” was back around 1890 IIRC. I correspond with people in other parts of the country and we’re getting off light.
Bret,
We’re getting off light because we never had it great. When the best of times aren’t all that great then the worst of times aren’t all that bad.
We do have some options city folks don’t have. Deer and other game to eat, possibly a little food from the garden and wood heat. Can’t do those things in the city.
Um…with 600 million dollars this bozo was borrowing money to invest? “A Fool and his money are soon parted”
What? Are we supposed to feel sorry for this family? They P***** away their fortune by being greedy, over spending – and probably not too generous donators to any good cause – trying to impress other people with their wealth.
AND, they still have a combined income of $62,000 a year. Doesn’t sound likr poverty too me.
Let the greenies at DEC have their way and you won’t be burning wood either
This guy was simply stupid! Spent WAY beyond his means, AND believed all the sales pitches of his investment advisers. You could maybe get away with one of those bits of foolishness, but not both.
And the real culprit here is his financial advisers– they had the guy borrowing money to invest– INSANITY! This is the kind of near criminal Wall St. behavior that almost did us all in– this guy is just an extreme example.
And you guys trying to hang this on Obama! Give me a break! This guy’s goose was cooked before Obama was even elected.
Finally, Bret, cutting wood on forest preserve land was outlawed by the NY State Constitution back in 1894– get over it! And over half the land in the Adirondacks is still in private hands.
A _fool_ (none of his decisions made the slightest bit of sense) and his money were soon parted. This is as laughable as a poor man blowing his welfare check on chrome rims for his “donk” to impress other hoodies.
No sympathy here. Rich or poor, I laugh at the _wilfully_ stupid.
It’s not a “painful” story. For every fool who loses their toys, many others get bargains at the liquidation sale!
One resource we definitely have a surplus of up here is whine. Wonder if we could bottle and sell it?
Is that dandylion whine or concord grape whine?
i always felt that if you want to be a millionaire in the adks, you need to start with 2 million.
Mervel, property tax is the way schools are funded in NY. It isn’t the best way to do it but nobody really seems to want to change it. That being the case property tax is based on the value of real property. Not greed at all just the way the pie is divided. If your part of the pie has more cherries you pay more for it and you get taxed more on it.
I know what property taxes do in NYS.
However in upstate NY they are also some of the highest rates in the nation. In addition the assessments are in large part corrupt they are not based on on the value of the real property.
For example take this case Brian has brought up. The value of that property is what it can bring in the market THAT is the market value not some tax assessors and taxpayers fantasy about gleaming income from down state rich people (which is fine by the way but lets be honest about what we are doing.) The value of Mr. Martin’s property is probably around 1.5 million or whatever the market will bear, if that is what he is being assessed at fine. If property taxes were based on the value of your real property then they should fall when valuations fall.
But yeah it is greed all a round everyone is lining up at the troth including the taxing authorities. Money is money and the government is just as greedy and rapacious as the private side for money and wealth.
One thing you need to keep in mind about property taxes and assessments is the pie is the budget.
After all is said and done, it doesn’t matter if assessments go up or down. If assessments go up, the tax rate goes down. If assessments go down, the tax rate goes up.
The only real question is whether or not properties are being assessed fairly in relationship to similar properties.
Assessors always complain about those who fight to have their assessment lowered, then go and sell at a price higher than they were assessed at.
Isn’t this a great country? A very small percentage of the population can own highly desirable property in the Adirondacks, on a beach in Florida, in Aspen, Manhattan, a “farm” in Connecticut (one each) so that they have a place to enjoy that the locals are forbidden to use. Then they get to complain that their taxes are TOO DAMN HIGH! after they have spent millions of dollars putting “improvements” on the property and the locals defend them because they get good jobs plowing the driveway and brushing stains out of their toilets.
Note to self: if I don’t want to pay lots of property tax I should not buy lake-front property and put a multi-million dollar mansion on it.
haha, well yes. So this small percentage of the population who is rich is suddenly not rich, what happens then do us regular folks gain anything?
No in fact the point of this tale is that these rich dudes who have chosen the Adirondacks for their expensive homes help the community not hurt it.
I mean you want to see what some communities looks like with zero wealthy people come on over to St. Lawrence county and I will show you a couple.
Denmark.
Minnesota.
Knuck, the alternative is the State owns everything, the locals can’t make use of it, there are no “rich guys” to work for and the tax base is entirely dependent on the locals, the guys with no jobs.
How is this better? I suppose we could take everything from the rich and give it to the “poor” until everyone is exactly equal (except of course for the people deciding who gets what) in which case there’s no reason to try and build anything, create anything, do anything.
How is this better?
I’m a single father making 30k a year and I get by just fine. No symapthy for this idiot.
I do think it is interesting. I wonder if our state being very high in income inequality compared to most other states makes this more striking?
http://money.cnn.com/2006/01/25/news/economy/income_gap/
It was interesting for example that in NYS the lowest 20% of the population made on average $16,076 in 2006, while in Nebraska the lowest 20% made 19,242. But of course the average income of the highest 20% in NYS was $216,000 compared to Nebraska’s $160,000.
I think it creates a more stable society when you don’t have those huge gaps like many of the Eastern and Southern states do.
Right on Mervel. I don’t want to get all John Lennon on everyone but imagine a society where there was enough of a safety net that the people could work jobs they loved doing rather than jobs just to pay the bills and get health insurance for their kids.
If you are a Christian you should remember the Seven Deadly Sins, greed, gluttony, pride, envy, sloth, wrath and lust. And what was that thing about the rich man the camel and the eye of the needle?
The most severe and scary scriptural warnings in the New Testament are warnings against greed and holding hostility toward the poor and vulnerable.
Consider the characteristics of the goats or consider the story of Lazarus.
Yes we need a consistent safety net and the thing is this could be done spending on the poor is not a budget buster.
My husband and I (who live outside of NYS) bought a vacation cottage in Upstate New York for $250K. It was much smaller than other nearby cottages and homes, but we soon found we were being assessed at our purchase price and not on similar comps in the area. When the town raised property taxes for everyone around the time of our purchase, they later granted a huge tax break for year-round residents. This practice will discourage real estate sales and keep people out with the money they can otherwise pump into the area. It certainly has for us and, sadly, will continue to keep Northern New York State in the poor, struggling condition it has been in for decades.
Knuck, that’s a dream, simply a dream. Lets say, through some miracle, you could have this wondrous safety net. Everyone works at a job they love. So who pumps the septic tanks, cuts the meat, cleans the motels, flips the burgers, arrests the criminals, plows the snow and does all the other jobs that people find out really suck once you get into it? What about the people whose only love is sitting in front of the TV with a case of beer and watching porn? Comon’, at least create a dream that has some practical chance of existing.
Let me try my version of your dream- There is a safety net for the truly infirm, aged and injured. There is a very low cost vocational training program for those who need skills (what I think our state colleges should be). For those who refuse to even try, we have no sympathy. Healthcare ? Outlaw insurance. Sounds crazy, I know. But prices would plummet overnight. It would destroy the “Health care industry” in an instant. Let the hospitals (little evil corporations of their own) finance things. At this point it’s either that or we just toss the towel in and give “free” healthcare to everyone without any means testing, etc. Of course the costs (over 1/5 of our economy) would cause a depression of it’s own, but what the heck! I could get that tummy tuck and the hair transplant and I always wanted green eyes. Think of all the boob jobs, nose jobs, chin lifts, liposuction, sex changes and other vital medical procedures that could be afforded! We’ll all be eating rats and cats and living in cardboard boxes, but by God, we’ll be good looking!
Monstra mihi pecuniam!
Nick Martin has been found ‘guilty’ of an ostentatious over-reach and ‘sentenced’ to ‘real’ life…again. Welcome back, ‘traveler’. One can only hope that this former college prof has ‘learned’ something(s) along the way.
Two ‘technical’ points:
1) Gordon Geko ‘greed is good’ ‘leverage’ (in options/futures ‘play’ in the stock/commodities markets cuts both ways) that’s why Nick got ‘margin calls’ he didn’t have ‘liquid’ assets to cover.
2) Over-developed a personal real estate property is only a ‘strategy’ for corporate crooks (ENRON, WORLDCOM, et al) looking to hide their ill gotten gains in FL (where the bankruptcy laws don’t put a cap on the property). All it gets you pretty much anywhere else in the US is an over-developed property that a) has no comps b) is very ILL-liquid [witness the Tupper property offer for just 1/2 of 1/2 of the $$ dumped into over-developing it]
And, finally an observation: ‘Stupid is as stupid does.’