After the pandemic hit, there was speculation that the financial industry might migrate from New York to Miami. This was fueled by the fact that the richest one percent face significantly lower state and local taxes in Florida compared to New York. However, the buzz around this potential exodus has diminished as the population of Miami-Dade County actually declined between 2019 and 2022.
So, what happened? While New York has experienced some population loss, it is far from the dystopian image that many outsiders perceive. In fact, its homicide rate is only half as high as Miami’s, and it boasts advantages such as an extensive mass transit system.
As life in New York returns to normal, the city is reclaiming its status as a haven for the affluent. As one asset manager wryly pointed out, “The main problem with moving to Florida is that you have to live in Florida.” This highlights the fact that decisions about where to live are not solely driven by tax rates. California, despite having higher taxes on high incomes than New York, is witnessing a surge in the number of millionaires and billionaires.
Now, while the population of Florida as a whole continues to grow rapidly, Miami’s stagnation raises questions about the factors behind the migration of Americans from the Northeast and California to the Sunbelt. One explanation favored by conservatives emphasizes the importance of a business-friendly environment and low taxes. Conversely, another perspective focuses on housing affordability.
The Northeast and California have suffered from limited housing construction, resulting in exorbitant housing costs. In contrast, metropolitan areas like Atlanta or Houston, thanks to more permissive zoning, offer cheaper housing options. Surprisingly, the Miami area, despite its low taxes for the rich, faces similar housing limits and high housing costs. Rents in Miami are considerably higher than in other major Sunbelt cities and not much lower than those in New York. Moreover, Miami’s ratio of median home prices to median income is even higher than New York’s.
The relative stagnation of Miami’s population suggests that the key to the Sunbelt’s growth lies in keeping housing affordable rather than catering to the rich. Florida as a whole continues to gain population, partly driven by retirees seeking warm winters. The increase in retirees creates job opportunities for younger adults as well.
While affordable housing appears to be the primary driver of growth in the rest of the Sun Belt, blue states seeking to combat their relative decline should prioritize increasing housing construction rather than implementing tax cuts for the wealthy.
Overall, the narrative of the financial industry flocking to Miami post-pandemic has lost its momentum. The reality is more nuanced, with various factors influencing where people choose to live and work. It’s essential to recognize the complex dynamics behind population shifts and regional growth.
Denial of responsibility! VigourTimes is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
