New Yorkers snapping up Miami Properties
April 24, 2015It’s a well-known fact that wealthy Latin Americans dominate the Miami real estate market. Besides the foreigners buying up luxury properties in Miami, there’s another force in town, the original Miami Beach settlers, New Yorkers. For many years, Miami has been the winter playground for these snowbirds.
As the real estate market in New York matures and significantly low interest rates keep savings rates at zero, the Miami real estate market is an attractive place to invest for many wealthy Northeasterners. Real estate provides a vehicle to park cash that’s more attractive than savings and money market accounts. With little threat of a bubble, the market is stable, and there’s a strong demand for event more luxury real estate inventory on the market. These factors suggest continued growth over the next several years.
Retiring New Yorkers, as well as Manhattanites purchasing first, second or third homes in South Florida are significant players in the market. After crunching the numbers, for an increasing number of New Yorkers looking to purchase a home, it makes more sense to continue renting in Manhattan and Brooklyn. Miami becomes an attractive place to buy. To a certain extent the New York real estate market has peaked. The Miami market is relatively young and has not maxed out in terms of available space to build to the same degree as Manhattan, or even Brooklyn.
The dollar also goes much further in Miami’s luxury market than it does in New York. Use to sky-high real estate prices at 3,000 to 4,000 per square foot, Miami is very reasonable. When you factor in taxes and the other expenses that come with owning property in New York, Miami is a fraction of the cost. Plus, establishing residency in Miami can save a New Yorker 12% in taxes a year, which is the total rate for state and city taxes combined. With neither a state of city tax, Miami is a bargain. Plus, it’s easy to hop on a flight at a moment’s notice, and in a couple of hours be out of freezing temperatures and on the beach.
Compared to other global luxury cities, Miami offers many advantages. Unlike, New York a large number of the luxury market homes are new and offer exceptional amenities. The added bonus is the lifestyle. With beautiful weather year round, world-class shopping and dining at your fingertips, a booming cultural scene and state-of-the-art homes along the ocean, Miami provides a high quality of life that is hard to not love. In fact, it provides everything New York does at a much lower level of stress. In short, it does not look like there will be a slow down anytime soon among New Yorkers snatching up property here.