{"id":154613,"date":"2023-06-28T15:23:15","date_gmt":"2023-06-28T21:23:15","guid":{"rendered":"https:\/\/www.biggerpockets.com\/blog\/?p=154613"},"modified":"2024-02-27T11:41:45","modified_gmt":"2024-02-27T18:41:45","slug":"moving-to-miami-could-save-thousands-but-what-is-that-doing-to-prices","status":"publish","type":"post","link":"https:\/\/www.biggerpockets.com\/blog\/moving-to-miami-could-save-thousands-but-what-is-that-doing-to-prices","title":{"rendered":"You Could Save Thousands by Moving to Miami, But It Isn\u2019t All Rosy\u2014Here\u2019s What You Should Know"},"content":{"rendered":"\n\n      <iframe loading=\"lazy\" frameborder=\"0\" height=\"200\" scrolling=\"no\" src=\"https:\/\/playlist.megaphone.fm\/?e=BIGPOC8222830010\" width=\"100%\"><\/iframe>\r\n  \n\n\n\n\n<p><span data-preserver-spaces=\"true\">For high-earners raking in between $150,000 and $650,000 annually, a move from New York City to Miami provides the opportunity to save thousands through a reduced effective tax rate and a decrease in the cost of living, according to a SmartAsset&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/smartasset.com\/data-studies\/wall-street-south-nyc-miami-2023\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">study<\/span><\/a><span data-preserver-spaces=\"true\">. San Francisco residents can realize similar savings by relocating to Miami.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">It\u2019s not that Miami is cheap\u2014the cost of living is 22.8% higher than the national average, and the&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.redfin.com\/city\/11458\/FL\/Miami\/housing-market\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">median sale price<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;for homes in Miami is about 34% higher than the national median, according to data from Redfin. But it\u2019s still&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.bestplaces.net\/cost-of-living\/miami-fl\/new-york-ny\/50000\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">cheaper<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;to buy a home, rent an apartment, or even go to a restaurant or grocery store in Miami than in notoriously expensive cities like NYC.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">But that could all change as more New Yorkers migrate to Miami in hopes of getting more out of their income. Miami residents began taking notice of their new neighbors from New York last year,&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/nypost.com\/2022\/05\/11\/miami-locals-blame-new-yorkers-for-driving-up-rents\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">blaming the skyrocketing rents<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;in the city on heightened demand created by movers. The savings potential is likely to shrink as Miami home values and rents increase amid constricted supply. Furthermore, homeowners insurance rates in Florida are&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.biggerpockets.com\/blog\/this-is-the-hardest-property-insurance-market-ever-whats-forcing-carriers-to-pull-out-in-droves\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">increasing dramatically<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;due to climate change, with premium hikes outpacing every other state. And a&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.businessinsider.com\/florida-homebuyers-shocked-by-skyrocketing-property-taxes-2022-11\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">surge in property taxes<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;for newly acquired homes is taking new residents by surprise.&nbsp;<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">Saving Money with a Miami Move: Current Estimates<\/span><\/h2>\n\n\n<p><iframe title=\"Moving From NYC to Miami\" aria-label=\"Table\" id=\"datawrapper-chart-vBQva\" src=\"https:\/\/datawrapper.dwcdn.net\/vBQva\/1\/\" scrolling=\"no\" frameborder=\"0\" style=\"width: 0; min-width: 100% !important; border: none;\" height=\"723\" data-external=\"1\"><\/iframe><script type=\"text\/javascript\">!function(){\"use strict\";window.addEventListener(\"message\",(function(a){if(void 0!==a.data[\"datawrapper-height\"]){var e=document.querySelectorAll(\"iframe\");for(var t in a.data[\"datawrapper-height\"])for(var r=0;r<e.length;r++)if(e[r].contentWindow===a.source){var i=a.data[\"datawrapper-height\"][t]+\"px\";e[r].style.height=i}}}))}();<\/script><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">The difference in cost-of-living estimates for these two cities is the most significant. Costs in NYC are 137.6% higher overall when compared to the national average, while costs in Miami are only 22.8% higher. Residing in Miami means an effective tax rate of between 27% and 35% for high earners, depending on their income when compared to an effective tax rate between 36% and 45% in NYC. This means savings of nearly $49,000 for NYC movers earning $150,000 annually and up to a savings of $195,000 for movers with a $650,000 annual salary.&nbsp;<\/span><\/p>\n\n\n<p><iframe title=\"Moving From San Francisco to Miami\" aria-label=\"Table\" id=\"datawrapper-chart-RsUh7\" src=\"https:\/\/datawrapper.dwcdn.net\/RsUh7\/1\/\" scrolling=\"no\" frameborder=\"0\" style=\"width: 0; min-width: 100% !important; border: none;\" height=\"740\" data-external=\"1\"><\/iframe><script type=\"text\/javascript\">!function(){\"use strict\";window.addEventListener(\"message\",(function(a){if(void 0!==a.data[\"datawrapper-height\"]){var e=document.querySelectorAll(\"iframe\");for(var t in a.data[\"datawrapper-height\"])for(var r=0;r<e.length;r++)if(e[r].contentWindow===a.source){var i=a.data[\"datawrapper-height\"][t]+\"px\";e[r].style.height=i}}}))}();<\/script><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">While the cost-of-living difference between San Francisco and Miami is not as pronounced, San Francisco residents still stand to save a pretty penny by relocating. Costs in San Francisco are 82.8% higher than the national average, 60 percentage points higher than in Miami. Meanwhile, effective tax rates drop from a range of 36% to 46% in San Francisco to as low as 27% in Miami. A $150,000 earner in San Francisco can save just over $36,000 per year by making the move, while a $650,000 earner can save a little more than $153,000.&nbsp;<\/span><\/p>\n\n\n<p><iframe title=\"Moving From Chicago to Miami\" aria-label=\"Table\" id=\"datawrapper-chart-8qxx2\" src=\"https:\/\/datawrapper.dwcdn.net\/8qxx2\/1\/\" scrolling=\"no\" frameborder=\"0\" style=\"width: 0; min-width: 100% !important; border: none;\" height=\"723\" data-external=\"1\"><\/iframe><script type=\"text\/javascript\">!function(){\"use strict\";window.addEventListener(\"message\",(function(a){if(void 0!==a.data[\"datawrapper-height\"]){var e=document.querySelectorAll(\"iframe\");for(var t in a.data[\"datawrapper-height\"])for(var r=0;r<e.length;r++)if(e[r].contentWindow===a.source){var i=a.data[\"datawrapper-height\"][t]+\"px\";e[r].style.height=i}}}))}();<\/script><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">The savings for a Chicago to Miami move are less substantial, showing how tax savings can be offset by a cost-of-living increase. Miami is more expensive than Chicago\u2014The cost of living in Chicago is only 17.1% more than average\u2014and, notably, the median sale price of homes in Miami is about 65% higher than in&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.redfin.com\/city\/29470\/IL\/Chicago\/housing-market\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Chicago<\/span><\/a><span data-preserver-spaces=\"true\">, according to Redfin. But tax savings of nearly five points across earners with high incomes mean that a Chicago resident earning $650,000 could still save almost $11,000 by moving to Miami.&nbsp;<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">How Will Miami Migration Affect the Real Estate Market?<\/span><\/h2>\n\n\n\n<p><span data-preserver-spaces=\"true\">Miami home values have a long way to rise before catching up to NYC\u2014the median home sale price would need to increase 46% while NYC prices stagnate, based on&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.redfin.com\/city\/30749\/NY\/New-York\/housing-market\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">Redfin data<\/span><\/a><span data-preserver-spaces=\"true\">. And home prices would need to rise further than that to cancel out the tax savings available to high earners relocating from NYC.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">While Miami home sale prices have risen against the norm in the past year, home price increases have been tempered by rising interest rates and an uncertain economy. Meanwhile, there is still an insufficient supply of homes in New York City to meet the demand for housing, according to a U.S. News&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/realestate.usnews.com\/real-estate\/housing-market-index\/articles\/new-york-city-housing-market-forecast\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">housing market forecast<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;from March. Real estate agents are still observing bidding wars in some areas, and overall, the market appears to be holding steady. Rental vacancy rates are also down year-over-year. Without falling prices in New York City, Miami\u2019s cost of living would need to suddenly skyrocket to dissolve the savings movers can achieve.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">Still, rising prices in Florida are already making the move less attractive, a local broker told the New York Post. While&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/nypost.com\/2023\/04\/12\/more-than-10000-new-yorkers-moved-to-florida-in-2023-so-far\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">10,824 New Yorkers<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;made the move to Miami in the first quarter of 2023, that number is down from 14,834 the year prior, according to data from the Florida Department of Highway Safety. Expensive cities in Florida, like Miami and Palm Beach, saw the largest influx of new residents from NYC\u2014the data follows the narrative that high earners from the city are seeking less expensive (but still luxurious) places to call home.&nbsp;<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">Is Miami the Best Move?<\/span><\/h2>\n\n\n\n<p><span data-preserver-spaces=\"true\">It\u2019s likely that high earners will continue to reap the rewards of an NYC or San Francisco to Miami move for years to come. But there are other factors to consider before permanently relocating to the Sunshine State. Recently, some new Florida homeowners have seen an&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.businessinsider.com\/florida-homebuyers-shocked-by-skyrocketing-property-taxes-2022-11\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">increase in their property taxes<\/span><\/a><span data-preserver-spaces=\"true\">, making them regret their decision to flee other states with higher tax rates. The tax burden of rising home values mainly falls on homebuyers getting into their first homes and people relocating from out of state due to a law that caps rates for existing homeowners.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">There\u2019s another factor that\u2019s even more concerning. Just a few decades from now, scientists expect downtown Miami to be underwater. By 2060,&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.cbsnews.com\/miami\/news\/scientists-warn-south-florida-coastal-cities-will-be-affected-by-sea-level-rise\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">almost 60%<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;of Miami-Dade County is expected to be submerged. But you\u2019ve still got years to live in Miami before climate change makes the city uninhabitable, right?<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">Maybe, but if a hurricane hits your Miami property, you may need to live elsewhere during the repairs. Not to mention, the cost of insuring your home could skyrocket. Some insurers have already begun&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.vox.com\/climate\/23746045\/state-farm-california-climate-change-insurance-wildfire-florida-flood\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">declining to issue<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;homeowners insurance policies in parts of Florida after massive losses. You can still get a policy, but it will cost you. Florida has experienced a&nbsp;<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.miamiherald.com\/news\/local\/environment\/climate-change\/article276126946.html\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">57% homeowners insurance premium hike<\/span><\/a><span data-preserver-spaces=\"true\">&nbsp;since 2015, the highest of any state in the nation, along with a 131% increase in flood insurance rates.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">The problem will only get worse as more weather events impact Florida\u2019s coastal cities. Eventually, Miami will become uninsurable. What may occur with the real estate market then could be catastrophic. If you get stuck with a property that can\u2019t be insured, it may be tough to sell as well.&nbsp;<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span data-preserver-spaces=\"true\">The Bottom Line<\/span><\/h2>\n\n\n\n<p><span data-preserver-spaces=\"true\">The combined savings from the reduced cost of living and decreased effective tax rate are substantial for high-earning residents of NYC and San Francisco opting to move to Miami. And remote work has made it possible for many high earners to pack up and relocate with ease.&nbsp;<\/span><\/p>\n\n\n\n<p><span data-preserver-spaces=\"true\">But as more people leave these high-priced cities and migrate to Florida, real estate in popular cities like Miami will be affected. The potential savings could shrink, especially if home values in San Francisco and NYC decline. And New Yorkers looking to settle down in a new state for the long term should consider the effects of climate change before relocating to coastal Florida. Still, if your job allows you the freedom to relocate, choosing an area with a lower tax rate and cost of living is a good strategy.&nbsp;<\/span><\/p>\n\n\n\n    \n  <div id=\"visibility-group-block_fde80631d91f23fa84d04a40ad6e4da9\" class=\"visibility-group alignwide  hidden\">\n        \n\n<div id=\"hero-block_5aec3fc67659c779a2ef227f248b8a2f\" class=\"first:mt-0 hero-block py-4  alignwide   has-background has-slate-200-background-color has-text-color has-theme-gold-color\">\n    <div\n        class=\"gap-10 lg:gap-20 flex flex-wrap lg:flex-nowrap max-w-screen-xl mx-auto px-4 relative lg:items-center \">\n\n        <div class=\"relative z-30 lg:w-1\/2 \">\n            <main class=\"py-4\">\n                \n\n<p class=\"has-slate-800-color has-text-color has-large-font-size\" style=\"font-style:normal;font-weight:800\">Find the Right Agent, Close the Best Deal<\/p>\n\n\n\n<p class=\"my-3 md:my-5 lg:my-8 has-slate-900-color has-text-color\" style=\"font-size:18px\">Step #1: Use Agent Finder to match with top <em><strong>investor-friendly<\/strong><\/em> real estate agents to help you find, analyze, and close your next deal.<\/p>\n\n\n\n<div id=button-custom-event-block_d57a5d52deae0d26757a9316ab836c3b class='button-custom-event'>\n      <a href=\"https:\/\/www.biggerpockets.com\/agent\/match\" x-on:click=\"window.analytics.track(&#039;Blog Block | B2C Marketplace Agent Finder&#039;, {\n      referrer: &#039;https:\/\/www.biggerpockets.com\/blog\/moving-to-miami-could-save-thousands-but-what-is-that-doing-to-prices&#039;,\n    });\" class=\" btn-shape inline-block no-underline has-background has-theme-blue-background-color has-text-color has-white-color\" target=\"_blank\">Find an Agent<\/a>\n  <\/div>\n\n            <\/main>\n        <\/div>\n\n                <div class=\"lg:w-1\/2 first:mt-0 relative h-full lg:flex lg:items-center\">\n            <img decoding=\"async\" class=\"object-cover w-full relative z-20 my-0  rounded-md hidden lg:block\" src=\"https:\/\/www.biggerpockets.com\/blog\/wp-content\/uploads\/2021\/08\/Marketplace-Blog-Blocks-Agent-v3.png\" alt=\"investor friendly real estate agent\" title=\"\">\n        <\/div>\n            <\/div>\n<\/div>\n\n  <\/div>\n  \n\n\n<div class=\"wp-block-group\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n    \n  <div id=\"visibility-group-block_64dd31c79f00f\" class=\"visibility-group  \">\n        \n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<div id=\"hero-block_64dd2875dba9d\" class=\"first:mt-0 hero-block py-4    has-background has-slate-100-background-color has-text-color has-theme-slate-color\">\n    <div\n        class=\" flex flex-wrap lg:flex-nowrap max-w-screen-xl mx-auto px-4 relative lg:items-center \">\n\n        <div class=\"relative z-30 w-full \">\n            <main class=\"py-4\">\n                \n\n<h3 class=\"wp-block-heading my-0 tracking-tight font-extrabold has-theme-slate-dark-color has-text-color has-large-font-size\">Join the community<\/h3>\n\n\n\n<p class=\"my-3 md:my-5 lg:my-8 has-theme-slate-color has-text-color\" style=\"font-size:16px;font-style:normal;font-weight:400\">Ready to succeed in real estate investing? Create a free BiggerPockets account to learn about investment strategies; ask questions and get answers from our community of +2 million members; connect with investor-friendly agents; and so much more. <\/p>\n\n\n\n<div id=button-custom-event-block_64dd2888dba9e class='button-custom-event'>\n      <a href=\"https:\/\/www.biggerpockets.com\/signup\" x-on:click=\"window.analytics.track(&#039;Blog Block | Acquisition | Free Membership Signup&#039;, {\n      referrer: &#039;https:\/\/www.biggerpockets.com\/blog\/moving-to-miami-could-save-thousands-but-what-is-that-doing-to-prices&#039;,\n    });\" class=\" btn-shape inline-block no-underline has-background has-theme-blue-background-color has-text-color has-white-color\" target=\"_blank\">Sign Up<\/a>\n  <\/div>\n\n            <\/main>\n        <\/div>\n\n            <\/div>\n<\/div>\n\n\n<div style=\"height:10px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n  <\/div>\n  <\/div><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Miami has become the new Austin, and movers in the country&#8217;s most notoriously expensive markets are taking notice. While the tax-free city seems financially sound on paper, what&#8217;s the catch?<\/p>\n","protected":false},"author":613615,"featured_media":154616,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7119,7364],"tags":[],"class_list":["post-154613","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-biggerpockets-daily","category-housing-markets"],"acf":[],"comment_count":0,"_links":{"self":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/154613","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/users\/613615"}],"replies":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/comments?post=154613"}],"version-history":[{"count":0,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/posts\/154613\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media\/154616"}],"wp:attachment":[{"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/media?parent=154613"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/categories?post=154613"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.biggerpockets.com\/blog\/wp-json\/wp\/v2\/tags?post=154613"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}