The Rich Migrate Down South as Taxes Rise Everywhere ElseSeptember 25, 2020
As taxes threaten to rise for the rich across the United States, more and more hedge funds are migrating to a place whose appeal is not just warm weather and growing cities, but also its lack of state income tax – Florida. With ballot measures throughout the U.S. calling for raising taxes on the wealthy, the affluential are moving down south presenting a growth opportunity for the Florida real estate market.
It’s no wonder hedge funds are also benefitting from this migratory trend. Paul Singer’s Elliott Management is considering setting up headquarters in the Sunshine State. Verition and ExodusPoint opened offices here recently as well. Balyasny Asset Management, a Chicago-based global industry-leading investment management firm with about $8B of assets, also intends to open an office in Miami. In 2018, Bluecrest Capital Management, who operates from New York opened a Miami office.
“Every firm like Elliott is in the process of evaluating choices in how and where they work, including working from home and opening additional offices, but Elliott has not made any decisions,” said Stephen Spruiell, a spokesman for the New York-based firm.
According to David Goodboy, head of the Palm Beach Hedge Fund Association – whose members are made up of asset managers and investment advisers – he’s already spoken to a substantial amount of people interested in moving to Palm Beach, Miami, and Boca Raton. After setting up an office in Boca Raton two years ago, Verition Fund Management expects more people will be migrating from Connecticut and New York.
No individual income tax along with property tax benefits for primary residences and the many asset protections offered, Florida has become the ideal home to many top wealth strategists.
The Sunshine State’s favorable tax laws have drawn in high-net-worth individuals for years, but a 2017 law that places a cap on deductions from state and local tax federal returns provide these wealthy migrators with even more incentive. With so many people moving down south, South Florida home sellers have been getting flooded with offers.
Miami is also doing its part to entice newcomers with its new “Follow the Sun” campaign – a $50,000 incentive for companies to relocate or expand offices to the magic city.
With so many affluential people chasing sunshine, now couldn’t be the better time to put your South Florida home on the market. If you’re thinking of selling your home, call or text the Bill and Bryan Team at 305.791.2349.