Zohran Mamdani’s main win in New York Metropolis’s mayoral race and proposal to lift taxes on millionaires have touched off fears of a brand new wave of wealth flight from town. But up to now, there may be little proof of a slowdown in high-end actual property or actual wealth losses in New York.
Florida actual property brokers say they’ve seen a surge in inquiries from the New York rich trying to transfer to Miami or Palm Seashore. Enterprise house owners are threatening to go away town or shut. And New York builders, caught within the crosshairs of Mamdani’s hire management platform, have banded collectively to fund Mamdani’s opponents within the November basic election.
On the middle of the financial concern is Mamdani’s so-called “millionaire tax.” He is proposed a further 2% tax on New Yorkers incomes greater than $1 million a yr. Added to town’s present prime fee of three.876%, the tax would carry the mixed New York Metropolis and state tax to 16.776%, by far the best within the nation. The mixed federal, state and metropolis fee could be 53.776%.
And New York’s excessive earners will not must go to Florida to keep away from the tax. They’ll merely transfer to neighboring Lengthy Island or Westchester County and even New Jersey. Not like New York state, New York Metropolis cannot tax individuals who work within the metropolis however have their main residence elsewhere.
“New York Metropolis can solely tax its personal residents,” stated Jared Walczak, vp of state initiatives on the Tax Basis. “A excessive earner does not want to surrender the comfort of town, they simply want to maneuver exterior the 5 boroughs. Migration throughout metropolis strains is the best.”
Zohran Mamdani gestures as he speaks throughout a watch celebration for his main election, which incorporates his bid to grow to be the Democratic candidate for New York Metropolis mayor within the upcoming November 2025 election, in New York Metropolis, U.S., June 25, 2025.
David Delgado | Reuters
Importantly, Mamdani would not be capable of elevate earnings taxes. The town’s earnings tax charges are set by Albany, the place Gov. Kathy Hochul has stated she is going to block any tax hike. “I do not need to lose any extra individuals to Palm Seashore,” Hochul told the New York Post.
Critics additionally worry Mamdani’s insurance policies towards the police and public security may make town much more harmful, changing into the ultimate straw for a lot of enterprise house owners and prime earners who have been already contemplating leaving. The highest 1% of New Yorkers pay over 40% of the earnings taxes, so shedding even a small variety of excessive earners would set off a downward spiral of decrease income and decrease providers and extra out-migration.
New York state had a internet lack of $14 billion in internet adjusted earnings because of taxpayers leaving between 2021 and 2022, in line with the Tax Basis and IRS information. The town’s income from private earnings taxes declined between 2022 and 2024, from $16.7 billion in 2022 to $14 billion final yr — though they’re nonetheless above the pre-Covid ranges of $13.4 billion in 2019, in line with information from the New York Metropolis comptroller.
On the similar time, nevertheless, there are indicators that New York’s highly effective wealth machine is continually replenishing the ranks of millionaires and billionaires, greater than making up for the wealthy who transfer out. The variety of millionaires in New York Metropolis has greater than doubled over the previous decade — regardless of the Covid losses — to over 2.4 million, in line with Altrata. There are actually over 33,000 New Yorkers value $30 million or extra, practically double that of Miami, in line with Altrata. Whether or not it is measuring millionaires, multi-millionaires or billionaires, New York Metropolis has maintained its dominance because the richest wealth hub on the planet.
“New York stays a strong magnet for the rich, providing a mix of luxurious consumption, vibrant tradition, high-quality training and way of life cachet, with the borough of Manhattan the epicenter of ultra-prime actual property,” stated a report from Altrata and REALM.
Demand for dear luxurious residences in New York additionally reveals no indicators of slowing, even after Mamdani’s win within the June 24 main. There have been 64 contracts signed between June 23 and July 13 for residences priced over $4 million, up 13% over final yr, with a gross sales whole of extra greater than $555 million in gross sales, in line with Olshan Realty. Among the many signed contracts was a $35 million, three-bedroom unfold on Fifth Avenue that was first listed in December.
“The luxurious market is on tempo for one among its greatest years,” stated Donna Olshan, of Olshan Realty, who additionally cautioned that any potential Mamdani-related weak spot may present up within the Fall.
Not solely did New York’s millionaire and billionaire inhabitants rebound rapidly after Covid, however excessive earners additionally bounced again. Whereas town misplaced a internet 5,000 households incomes $1 million or extra through the pandemic, their ranks have grown from 30,400 in 2019 to 34,127 in 2022, the ad interval obtainable, in line with the Fiscal Coverage Institute.
Nathan Gusdorf, govt director of the Fiscal Coverage Institute, stated the narrative of wealth flight from New York is fed partially by the media, which highlights a small variety of high-profile billionaires who transfer from New York to Florida. Tales about billionaires like Josh Harris, Carl Icahn and Daniel Och decamping to Florida ignores the broader ebb and movement of wealth in New York. New York’s highly effective economic system, fueled by the monetary providers trade, continues to supply extra new millionaires than it loses.
“We should not have a set inhabitants of millionaires that simply declines each time one among them leaves,” Gusdorf stated. “The town regenerates that misplaced millionaire inhabitants.”
Even when Mamdani have been to win the mayorship in November and lift taxes, the direct influence on wealth flight could also be extra restricted than many count on. In accordance with the Fiscal Coverage Heart’s ad analysis, the highest 1% of New Yorkers by earnings (these making greater than $800,000 a yr) go away town at one quarter the speed of all different earnings teams. When the New York rich do transfer, they’ve most frequently oved to different high-tax states like New Jersey, Connecticut or California – suggesting way of life fairly than taxes are the motive force.
“There’s a sturdy indication that increased tax charges on the state stage imposed on the highest earners usually are not having actual behavioral results,” Gusdorf stated.
Others, nevertheless, say taxes have outsized significance for the rich, confirmed by the sweeping inhabitants strikes in recent times from high-tax to low- or no-tax states like Florida and Texas.
A examine by the California Heart for Jobs and the Economic system described a “taxodus,” or internet lack of $5.3 billion in private earnings tax, from excessive earners who left after a 2016 extension of upper taxes on the rich.
“Excessive tax charges do result in outmigration and decrease earnings development,” Walczak stated.