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By: Ilana Siyance
In 2023, some 65,000 residents fled the New York metropolitan area. Were they better off?
High-earning New Yorkers started fleeing to warmer spots with lower taxes when the COVID-19 pandemic hit. Wooed by the promise of lower expenses, more recently NY residents have continued to move to Florida and Texas. As per the NY Post, a new report has revealed that those who more recently fled saved less than those who moved four years ago, because home prices in those states have been soaring.
The lower savings stems from an increase in home and rent prices in those states, with Miami real estate up some 40 percent since the pandemic. The research by financial information provider SmartAsset, shows that New Yorkers earning $250,000 who moved to Miami last year ended up saving $88,036 — or 28% less compared to people in that income bracket who moved to South Florida in 2019. People who had moved early on in the pandemic had saved $122,956 on average, Bloomberg News had first reported. A New Yorker earning $250,000 who moved to Austin, Texas last year saved just roughly $116,195, per the SmartAsset report. That’s 25 percent less than the $154,564 they would have saved in 2019. Also, New Yorkers in the same tax bracket who moved to Dallas, TX last year saved $108,208. That’s 20 percent less than the $135,887 annually they saved annually in 2019, per the report.
The SmartAsset data also reveals that the rate at which cost of living is jumping in Miami, Austin and Dallas is outdoing therise of costs in Manhattan. From 2019 to 2023, in Manhattan home rents increased by 3.3%, while home prices have jumped 29.3%. Meanwhile, the cost of energy and utilities in Manhattan is down 13.7 percent, though the cost of gas is up 35.7 percent. By comparison, in Miami, rent has soared during that same time frame by 37 percent, while home prices are up a whopping 43.7 percent, per SmartAsset. During that time, the cost of energy and utilities in Miami jumped 17 percent..
Also, in Austin rents are up 25.5%, and home prices have jumped a shocking 55.6%. Energy and utilities there are up 12.5%, and gas prices rose by 32.3%. In Dallas, rent has actually dropped 1.1%, but home prices are up 21%. Energy and utilities rose 16.5%, and gas prices grew by 32.8% in Dallas.
NYS had the third highest income tax rate in the U.S. in 2023, according to a study by TurboTax. Nine states, including Florida and Texas, do not charge residents a state income tax. As per the Post, the heavy demand for real estate in those states has led to a surge in home prices there. In Texas, this increase has led to a jump in the property tax rate, which has heavily impacted longtime residents. Florida has experienced a jump in another related expense—namely property insurance. Sunshine State residents paid 42% more for coverage last year compared to 2022, in what is becoming known as a property insurance crisis. In 2023, Florida residents paid an average of roughly $6,000 for home insurance —which is close to three times the national average of $1,700. “The fact that people continue to absorb increased costs of food, nightlife, culture and real estate means that this is a new normal,” Michael Martirena, a luxury real estate adviser with Miami-based firm Compass, told The Post.
