Miami takes the title of No. 1 fastest growing luxury real estate market in the United States, and No. 5 fastest growing luxury real estate market in the world after Madrid, Berlin, Paris and Cape Town, reported the Knight Frank Wealth Report.
The Miami real estate market, which includes both new and existing construction properties, has experienced record sale activity in the past few years. Strong sales have been witnessed and recorded in some neighborhoods and price points.
Tax refugees from cities such as New York, Chicago and Los Angeles have shown a keen interest due to no income tax imposition in Miami as compared to a high income tax of 13.3 percent in other states. Billionaire investor Carl Icahn and billionaire hedge fund managers David Tepper and Paul Tudor made headlines this year with moves of their offices to Florida, which offers lower taxes.
Over the past few years, it has been observed that high-earning professionals, tech moguls and Wall Street hedge-fund managers acquire luxury homes in Miami as their primary residence to escape the effect of the federal tax reform law that was implemented in 2018 and to benefit from the lower-tax policies of the Florida state. This has shifted the demand from other high-end property markets elsewhere in the United States to that of Florida. These buyers have actively contributed to this increased demand and sales in Miami's luxury market.
Consequently, the prices of luxury condos and single-family properties in the market have also increased in value. The first quarter 2019 Douglas Elliman report reveals the median price of luxury single-family homes soared 61 percent year-over-year to $10.1 million, while that of luxury condos climbed 12.7 percent to $3.23 million. Despite the increase in prices of real estate in Miami along with its popularity and demand, the market still attracts potential buyers from not just within the United States but also from foreign countries. For overseas home buyers too, Miami is among the top U.S. destinations, according to Realtor.com and Trulia.com.
