Report: Southeast Benefitting from Significant Northeast Migration

Real Estate In-Depth | May 2019

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NEW YORK—A recently published report by Bloomberg News reveals some unsettling news for New York State businesses and the real estate industry here.

The report, an analysis by Bloomberg of state-to-state moves based on data from the Internal Revenue Service and the U.S. Census Bureau, shows that New York and Connecticut are losing billions in revenue due to migration to Florida and other popular southern states. The report was based on year-to-year moves based on address changes on individual tax returns, in 2016 as compared to 2015.

It should be noted that the data from the report predates the implementation and possible impacts of the federal tax reform law and the SALT tax caps imposed by the federal legislation.

The Bloomberg report states that recent data indicates that New York’s annual net loss was the highest of all 50 states, with a net $8.4 billion leaving the state. Exiting incomes of $19.1 billion were replaced by people who brought in $10.7 billion less in income. Illinois and New Jersey were next with net outflows of $4.8 billion and $3.4 billion, respectively.

Connecticut lost the equivalent of 1.6% of its annual adjusted gross income. People who moved out of the state had an average income of $122,000, which was 26% higher than those migrating in.

Florida is the big winner in the move-in, move out game and posted a net income influx of nearly 3% of the state’s adjusted gross income in 2016, according to the report. South Carolina, Idaho and Oregon were also among the largest gainers in terms of migration.

“Florida’s powerhouse economy continues to churn out new jobs, retiree migration to Florida is on the rise, and millennials are coming into their prime home-buying years,” Brad O’Connor, chief economist for Florida Realtor, said in a report before the trade association’s annual summit.

The Florida Realtors trade organization reported on May 21 that Florida’s housing market reported more sales, higher median prices and increased inventory in April compared to a year ago. Sales of single-family homes statewide totaled 26,992 last month, up 6.2% over April 2018.

“Still-low mortgage interest rates and a strong jobs outlook are positive trends for Florida’s housing market,” said 2019 Florida Realtors President Eric Sain, a Realtor and district sales manager with Illustrated Properties in Palm Beach. “Another strong sign: new pending sales for existing single-family homes in April rose 4.4% year-over-year, while pending sales for existing condo-townhouse properties remained at about the same level (-0.8%) as April 2018.

In April, statewide median sales prices for both single-family homes and condo-townhouse properties rose year-over-year for the 88th consecutive month. The statewide median sales price for single-family existing homes was $259,470, up 2.6% from the previous year. The statewide median price for condo-townhouse units in April was $194,050, up 2.1% over the year-ago figure.

To access the full Bloomberg report entitled “Florida Is the Big Winner as the Wealthy Move Out of Northern States” go to https://www.bloomberg.com/news/articles/2019-05-24/migration-s-biggest-loser-is-connecticut-as-florida-profits