If Jeffrey Epstein's NYC mansion hits the market, its value will likely have 2 driving forces against it: A slow luxury market, and its tainted history
- Jeffrey Epstein was arrested on July 6 on suspicion of engaging in sex acts with minors in his Manhattan mansion and other homes.
- The government is now trying to seize the NYC mansion, according to Bloomberg.
- After a home is forfeited by the government, it is listed on the public market. If Epstein's mansion is successfully seized, history predicts the current market will be far from welcoming.
- According to New York-based real-estate agent Kyle Egan, a slowed luxury market and tainted history may lower its future asking price.
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Since news of Jeffrey Epstein's most recent arrest, the value of his 21,000-square-foot, seven-story Manhattan mansion on the Upper East Side has been in question.
Jeffrey Epstein was arrested on July 6 on suspicion of engaging in sex acts with minors in his Manhattan mansion and other homes. Since then, the government has been trying to seize the New York property.
According to Bloomberg, a court document estimates the home's current value to be $77 million, but the New York City Department of Finance valued the home closer to $56 million earlier this year.
However, both estimated values may prove to be way off if it hits the market.
Two factors might change the value of Epstein's home if it hits the market
Taking the alleged crimes out of the equation, the home is a very valuable asset, New York-based real-estate agent Kyle Egan explained to Business Insider. It is one of the largest private residences in Manhattan and is located in a highly regarded area where the median listing price is $1,288,300.
If Epstein's home hits the market in the coming years, however, its value will have two driving forces against it: a slow luxury market and ties to an alleged crime, Egan said.
For starters, New York's slow-moving luxury market has seen cuts on the price tags of many multimillion-dollar homes - even those with a clean record. Mansion Global reported that in the first five months of 2018, more than half of Manhattan's luxury homes listed for $4 million and above were sold at discounted prices.
Just a few blocks away from Epstein's Upper East Side mansion, a townhouse sold for $31.95 million this past September - at an 8.71% discount. However, the record-breaking $80 million sale of another townhouse in the neighborhood - which closed this past June - makes it difficult to predict how the saturated market may impact the future sale of Epstein's mansion.
"There aren't great comps for properties like [Epstein's mansion]," Egan told Business Insider. "There just aren't many [homes] that exist of that size and have come to market in recent years and sold."
Bracing for a slow-moving market is just the start of the mansion's potential troubles.
The second major obstacle
Real-estate appraiser Orell Anderson told MarketWatch that homes with ties to tragedies or crimes are oftentimes sold to buyers at discounts as high as 25%.
According to MarketWatch, Anderson appraised the home where Nicole Brown Simpson was murdered. Although the Los Angeles home was originally purchased for $625,000, after the murder, it sold for $525,000.
"After an event like this occurs, and the public becomes aware of it, all of a sudden the value drops significantly," Anderson said to MarketWatch.
Prospective buyers of Esptein's Manhattan mansion will not only have to look past its history, but stomach its unusual decor, too. In 2003, Vanity Fair reported that decorations throughout the home included bizarre items like framed eyeballs made for injured soldiers and a stuffed black poodle.
However, despite the history of the property and its strange interior, Egan said the biggest indicator of the property's future value will be the state of the market it enters.
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