Rich New Yorkers are fleeing to Miami to escape high taxes. I spent 3 days there, and it was immediately clear why so many people are making the move.
- Wealthy New Yorkers are fleeing the city in droves and making their way to Miami.
- I recently spent three days in Miami, and after my trip, I could definitely understand why rich New Yorkers would want to move there.
- New York millionaires who relocate to Florida can save more than $1 million in taxes each year.
- And beyond the tax benefits, Miami home buyers get much more bang for their buck in the form of more spacious layouts, generous outdoor space, and waterfront views.
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More and more rich New Yorkers are ditching the northeast for sunny Miami.
High-net-worth individuals and families from high-tax states like New York, New Jersey, California, and Illinois are moving to the Miami area to take advantage of Florida's status as a no-income-tax state, Dora Puig, a top real-estate broker in the area, previously told Business Insider.
I recently spent three days in Miami, touring exclusive private islands, waterfront mansions, and a $48 million penthouse. I spent an afternoon on Fisher Island, a members-only island that's one of the most popular destinations for affluent New Yorkers moving to the area. It's also the richest zip code in the US, with an average income of $2.2 million.
It didn't take long for me to see why wealthy New Yorkers are moving to Miami.
Millionaires from New York can save more than $1 million in taxes by relocating to Florida.
President Donald Trump's 2017 tax overhaul capped the amount of state and local tax deductions at $10,000, which hit wealthy homeowners in high-tax states like New York and California particularly hard and prompted many to relocate to Florida.
Read more: How Trump's new tax law affects homeowners at every income level from $83,000 to $336,000 a year
Under the new tax laws, a New Yorker who makes $10 million per year and owns a $10 million home would save almost $1.2 million in total taxes by relocating to Florida, according to Crain's New York Business.
Beyond the tax benefits, luxury home buyers get more bang for their buck in Miami than in New York City.
In New York City, I've toured homes including a $40 million triplex penthouse, a $22 million "sky mansion," and a $58.5 million condo on the 87th floor of a Billionaires' Row tower.
In Miami, after visiting a $48 million penthouse, a $29.5 million waterfront mansion, and a $24 million home on a private island, it quickly became clear that money buys you a whole different type of luxury: The Miami homes are larger and often have generous private outdoor space, as well as waterfront locations, surrounding greenery, and swimming pools.
The $48 million penthouse I saw in Miami Beach, for example, spans 11,031 square feet across three floors and included a 2,000-square-foot terrace and a private pool. The $58.5 million condo in New York, on the other hand, has a relatively modest 6,234 square feet of living space on just one floor - and not even the top floor.
There's also no private outdoor space, yet it's more than $10 million pricier than the Miami Beach penthouse. While it's hard to say that one is categorically better than the other, what I did find was that your money will simply buy you more space in Miami.
As an added bonus, every single home I visited in Miami had a pool, a rarity in New York City.
There is one major downside to moving to Miami.
In addition to the tax breaks and the home sizes, there's the simple matter of the weather: Miami has plenty of beautiful beaches to enjoy the temperate weather. New York City has beaches, of course, but they're not nearly as accessible as those in Miami and they lack the same warm waters.
But, while Miami may have a lot of great things going for it, science indicates that the city will likely be partially underwater and unlivable within 80 years due to rising sea levels and increasingly intense storms.
Read more: Miami is racing against time to keep up with sea-level rise
When I asked real-estate agents why wealthy home buyers continue to snap up luxury waterfront homes in Miami, and why developers keep building condominiums right on the water, I was told that people aren't too concerned about the future.
"My clients are not making their home-purchasing decision on what may or may not be 100+ years out," Dina Goldentayer, the executive director of sales at Douglas Elliman in Miami Beach, previously told me. "They want to enjoy their wealth now with their families in their homes."
Then again, New York City is also surrounded by water, making it susceptible to rising sea levels. But, between the two, I can certainly see why millionaires would see Miami as a better bet.