We tried to predict the best places to move during the pandemic. The results are in, and we were half right.

Postcards of Champaign-Urbana, Cheyenne, Rochester, and Huntsville taped on orange paper, with truck and house stickers
  • We looked back at four highly ranked areas on our list of the best cities to move to post-pandemic.
  • Net domestic migration from 2019 to 2020 for these metro areas was pretty similar to previous years.
  • Huntsville, Alabama, had a larger positive net domestic migration this year, continuing its growth.
  • See more stories on Insider’s business page.

Three months ago, Aaron and Christine Lager traded their 1,100-square-foot home outside San Francisco house for a 3,500-square-foot property in Huntsville, Alabama.

The aerospace and defense company Lockheed Martin had offered Aaron a good, well-paying job, and Christine was enchanted by the city’s quaint downtown.

Huntsville is one of the winners of the pandemic migration boom. The metro area had a positive net domestic migration – the number of people moving into a metro area from elsewhere in the US minus people moving out to another part of the country – of 8,964 from July 1, 2019, to June 30, 2020, according to the most recently available US Census Bureau data. This was higher than the 6,815 in the same period a year earlier.

We anticipated its success: In summer last year, as moving became a popular conversation topic, and people debated the best places to ride out lockdowns and work remotely, Insider decided to use available data to create a list of the best cities to move to after the pandemic. The metropolitan-area data, which was mainly from before the pandemic, covered nine metrics. For example, low unemployment rates, low cost of living, and high ability to work from home would likely lead to a higher place in the ranking. Huntsville came out among the top 10, in part for its high educational attainment and high share of jobs that could be done remotely.

Now that it has been over a year since we came up with our list, we were interested in seeing if people moved to the cities that made up some of the top spots.

As seen in the chart below, people did move to Huntsville and Cheyenne, Wyoming, which we anticipated. But two other cities we thought would do well – Rochester, New York, and Champaign, Illinois – lost residents.

But gains and losses for these metro areas aren’t new.

A closer look at data from the Census Bureau over the past few years showed a lot of the cities mostly experienced domestic migration that followed trends that had gone on for years. This fits in with other findings that the pandemic accelerated moves that were already in the works, like Americans moving from high-tax to low-tax states and leaving large and expensive metro areas for suburbs and secondary cities.

Huntsville, which came in ninth in our ranking, is a prime example. It had positive net domestic migration every year, according to data from the past decade. Meanwhile, Rochester, which ranked 15th in our ranking, experienced the opposite. From 2010 to 2020, its metro area recorded negative net domestic migration every year. We thought that COVID-19 might result in some new areas experiencing an influx of residents given the flexibility for people to work remotely, but the destinations of choice actually didn’t change that much.

To be sure, the census estimates don’t cover the full year of 2020 and aren’t the official decennial count. Others, like The New York Times and Bloomberg, have used US Postal Service change-of-address data to figure out where people moved during the pandemic.

One thing’s for certain: We were right that the pandemic offered a huge opportunity for some people to rethink where to live. Just because one in five (according to one Pew estimate) people moved during the pandemic or knows someone who did doesn’t mean they dramatically changed where they moved. And we didn’t take into account previous moving patterns to and from metro areas when coming up with our own guesses for relocators’ destinations of choice.

Below are our deep dives into four locations from our best-city list: two with positive net domestic migration and two with negative net domestic migration during part of the pandemic.

Huntsville, Alabama

Postcard of Huntsville, Alabama taped on orange paper, with truck and house stickers

Huntsville was perhaps our best call, ranking ninth on our best-city list. The census statistics show that, over time, more people have moved there from other parts of the US than moved out. Outside the government-data release, an annual study from United Van Lines National Movers found Huntsville was the fourth most popular city to move to in 2020.

Why? Thousands of tech workers are flocking to Huntsville — Alabama’s unsung “rocket city” — for good jobs and Southern hospitality. The longtime NASA hub is luring Facebook, Boeing, Blue Origin, and other major employers. Plus, new arrivals from Silicon Valley find their money goes much further.

Subscribe to read more about the tech-worker boom in Huntsville, a hidden gem and unsung hot spot.

Cheyenne, Wyoming

Postcard of Cheyenne, Wyoming taped on orange paper, with truck and house stickers

Cheyenne ranked 12th on our list of cities to move to after the pandemic, in part because of its shorter weekly commute and lower population density. Indeed, Wyoming’s rugged capital saw an influx of residents during the pandemic that mirrored five years of steady arrivals. 

Conservative politics and wide, open spaces have drawn herds of relocators. Take Microsoft employee Troy Nowak, a California native who wanted to move his family to a place with outdoor activities, low crime, and no traffic. He chose Cheyenne.

Subscribe to read more about Cheyenne and its pandemic-fueled boom. Westward ho!

Rochester, New York

Postcard of Rochester, NY taped on orange paper, with truck and house stickers

Unlike Huntsville and Cheyenne, more people left the upstate city of Rochester for elsewhere in the US — in line with years of population decline that preceded the pandemic. So while Rochester ranked 15th on our list of places to move after the pandemic — in part for its per-pupil spending on education and share of jobs that could be done from home — it didn’t actually gain residents last year.

Betty Battaglia, a local broker, was shocked to hear that “American’s first boomtown” — a five-hour drive northwest of Manhattan and sandwiched between Syracuse and Buffalo — lost residents. She described a red-hot housing market with dozens of prospective buyers placing competing offers on each listing and pushing prices up. 

It turns out that while people did leave Rochester in 2020 — some to head south or to other low-tax, warm-weather states, in a continuation of migration trends of the past decade — many moved to upgrade their quality of life locally. There was enough demand for homeownership from locals, in fact, that the population loss barely registered.

Read more about the scene in Rochester, where homes are selling for $100,000 over ask.

Champaign-Urbana, Illinois

Postcard of Champaign-Urbana, Illinois taped on orange paper, with truck and house stickers

As Americans flee urban hubs for larger homes and a lower cost of living during the coronavirus pandemic, the Champaign-Urbana metro area seems like the perfect landing pad. It’s in central Illinois amid corn fields, about 135 miles south of Chicago and 125 miles west of Indianapolis — within a two-hour drive of either city. It has a rural but lively college-town feel thanks to the state’s flagship public university, the University of Illinois at Urbana-Champaign. 

Champaign-Urbana placed third in our ranking, in part because of its shorter weekly commute and higher educational attainment. But it also lost residents during the pandemic.

Even as people leave Champaign in droves, the local real-estate market remains emblematic of the national frenzied housing market marked by all-cash offers, sight-unseen purchases, and creative buyer tactics. There are still enough people who want to buy homes in the college town, and inventory is so limited in Champaign and nationwide that demand has driven prices up anyway.

Read more about Champaign, which is bustling despite losing residents. 

Read the original article on Business Insider

I’m a teacher in a tiny Alaskan village. My class consists of 8 students and there are no sports teams or after-school clubs – here’s what my life is like.

two small white buildings in the Alaskan bush
The view of Taryn Williams’ house, right, from the school steps.

  • Taryn Williams, 28, is a teacher and freelance writer based in the rural Alaskan Bush.
  • Everything is really close by, but groceries cost more than they do in mainland US.
  • She spends an hour cooking dinner and stays entertained by participating in local customs.
  • See more stories on Insider’s business page.

One of the greatest benefits of life in the Alaskan Bush is how close everything is.

Taryn Williams
Taryn Williams.

When I lived in Philadelphia, it took me nearly an hour to commute to my school via public transportation.

Here, it takes less than two minutes to walk there. I get to sleep in later and have a slower morning, as there’s no stress that I’ll have to pay for a taxi if I miss the train.

Read more: I moved from Atlanta to a tiny Alaskan village of 270 people. It’s wildly expensive, but I’ve never felt more at home.

There are no coffee shops on my route (or any in a hundred-mile radius). Instead, I make my own chai lattes with chai tea, milk, cinnamon, and spices in a pot on the stove. It’s not quite as convenient as a local shop, but it tastes just as good.

School is different in the Bush, too. Most teachers have multigrade classrooms (think kindergarten to fourth grade or all of middle and high school) and class sizes are generally smaller.

In my current seventh- to twelfth-grade class, I teach 8 students in 5 subjects.

With students in so many different grade levels, there’s a lot more facilitating than there is in larger schools, but my students have also gained an enormous amount of independence because of this.

Since I live so close to school, I’m able to go home for lunch every day, and it’s something I’ve really grown to appreciate.

Last year, my students brought me a puppy they found – there’s a problem with puppy overpopulation in the Bush – and she’s been with me ever since.

white puppy on a mountain in the Alaskan bush
Taryn Williams’ dog, Betty.

My lunch is only 30 minutes, but my house is close enough that I can get there quickly and play with her outside for a few minutes while my food heats up.

There are no local sports clubs students can join, and they can only interact with youth from other places remotely.

I want my students to have the most enjoyable high school experience possible, so I’m always looking for after-school opportunities for them.

Most recently, I facilitated an internship where students learned how to make their own podcast from a Native Alaskan podcaster. I try to find activities that align with my students’ interests and guide my search based on that.

There are no restaurants, movie theaters, bowling alleys, or other ‘traditional’ Western sources of entertainment.

My students often ask me to take walks with them or share a mug of tea after school. They enjoy learning about the other places I’ve lived and what my life was like where I grew up. Often, they accompany me when I take my puppy for a walk down to the local store and post office.

a scenic view of the Alaskan bush
The view of the village from outside Taryn Williams’ home.

The store is small and the prices are higher than you would find elsewhere.

If there’s something that I use frequently – something that others would use as well – they’ll sometimes order it. I usually buy all perishable products there, such as pints of Ben & Jerry’s ($9) and blocks of cheese ($15). I buy orange juice only on special occasions, as it usually costs about $17.

After walking to the store to pick up any groceries or packages, I try to go for a longer hike or run with the puppy.

In the spring and fall, when we have 18 hours of daylight, I try to spend as much time outside as possible. In the winter, we only have a few hours of sun and I tend to stay closer to home – or follow along with Yoga with Adriene videos on my SmartBoard at school.

I usually spend about an hour cooking dinner each night.

I’m a vegetarian and order produce from Full Circle Farm in Washington for all of my meals.

Cooking is one of my greatest joys in life and I’m so grateful to live somewhere where I can dedicate significant time to it each day.

If there’s something going on in town – a gathering for a wedding or a holiday, for example – I always head there and participate in local customs. Most nights, however, I cozy up in my reading nook or play a movie I downloaded on Netflix.

I often spend weekends tagging along on hunting or fishing trips even though I don’t participate, and I’m incredibly grateful to the villagers that have welcomed me into their lives. I’ll take the things I learned from them and from living here with me wherever I go next.

Read the original article on Business Insider

Tech legend Marc Andreessen says the rise of remote work might be more important than the internet: ‘A permanent civilizational shift’

remote work
Remote work has changed everything.

  • Remote work is “a permanent civilizational shift,” Marc Andreessen wrote in a recent blog post.
  • It’s “a consequence of the internet that’s maybe even more important than the internet,” he wrote.
  • Remote work has freed up opportunities for knowledge workers, which could lead to shared prosperity.
  • See more stories on Insider’s business page.

Technology has saved the world.

So said tech entrepreneur and venture capitalist Marc Andreessen in a recent blog post, in which he said he believed remote work was “a permanent civilizational shift.” Its impact could be even greater than that of the internet itself, he added.

“It is perhaps the most important thing that’s happened in my lifetime, a consequence of the internet that’s maybe even more important than the internet,” he wrote. “Permanently divorcing physical location from economic opportunity gives us a real shot at radically expanding the number of good jobs in the world while also dramatically improving quality of life for millions, or billions, of people.”

He continued: “We may, at long last, shatter the geographic lottery, opening up opportunity to countless people who weren’t lucky enough to be born in the right place. And people are leaping at the opportunities this shift is already creating, moving both homes and jobs at furious rates.”

Already, remote work has freed up many more possibilities for knowledge workers, unshackling them from the office desk and freeing them to move to more affordable areas during the pandemic. It spurred what seemed to be a mass migration from superstar cities like San Francisco and New York to more mid-tier cities like Austin and Miami, as these workers fanned out around the country.

While recent US Census data shows that the pandemic didn’t really change population growth, the rise of remote work helped accelerate existing migration patterns of those moving from the cities to the suburbs. Such movement fueled a housing crisis marked by a historic shortage, as everyone suddenly became an aspiring homebuyer. But the upside of the migration is that it could help create a new era of more broadly shared prosperity.

Read more: 3 ways the US economy is uniquely positioned for a great new era in the 2020s

Andreessen is alone in highlighting the significance of this shift. “I have long said that we will see the rise of the rest, given the incredible expensiveness and affordability of existing superstar cities,” Richard Florida, urban studies theorist and economics professor at the University of Toronto, previously told Insider. “But it’s not going to be the rise of everywhere. It’s going to be the rise of a dozen or two dozen places.”

These places will consequently attract new talent, Florida said, changing economic development, but he doesn’t see bigger cities going away, predicting a resurgence upon widespread vaccination, even if remote work is likely here to stay. He did predict that post-pandemic cities will be reshaped and revived by a newfound focus on interpersonal interaction that facilitates creativity and spontaneity.

“Even as offices decline, the community or the neighborhood or the city itself will take on more of the functions of an office,” he said. “People will gravitate to places where they can meet and interact with others outside of the home and outside of the office.”

The impact of remote work has already trickled into other facets of life outside of geography. Consider the restaurant industry, which has already been reshaped by remote work.

Many restaurants had to adopt technology for the at-home worker to keep afloat during the pandemic, and many now expect more than half of their total revenue to come from online ordering. In dining rooms, some higher-end restaurants have ditched jacket requirements as part of the pandemic’s sartorial shift to more casual wear.

Many global companies are prepping for a hybrid work model post-pandemic, implicitly agreeing with Andreessen. If remote work is here to stay, at least in some form, it will just continue to reshape society, with major implications for the economy and everything else.

Read the original article on Business Insider

Fossils unearthed in China reveal a new species of giant prehistoric rhino – the largest land mammal to ever walk the Earth

giant prehistoric rhinoceros stands as tall as trees against a cloudy sky
An illustration of the Paraceratherium linxiaense giant rhinoceros in the Linxia Basin during the Oligocene.

A batch of newly discovered fossils come from prehistoric giant rhinos – the largest known land mammal in the history of the Earth.

Paleontologists discovered a complete skull from one rhino and three vertebrae from another, in the Linxia basin in the Gansu Province of northwestern China. The set of bones is 26.5 million years old.

Genetic analysis revealed that the fossils belonged to a species of giant rhino that scientists had never seen before. The team of researchers from China and the US dubbed the new animal “Paraceratherium linxiaense.”

“Usually fossils come in pieces, but this one is complete, with a very complete skull and a very complete jaw, which is rare,” Deng Tao, who led the team that discovered the fossils, told CNN. Deng is a professor at the Institute of Vertebrate Paleontology and Paleoanthropology at the Chinese Academy of Sciences.

Taller than a giraffe and roughly the size of six elephants, the rhino towered 23 feet above the ground, and its body was 26 feet long, Deng told CNN. It weighed roughly 24 tons. The skull was more than three feet long.

“It was very rare for a skull of that size to be preserved,” Deng said.

Deng and his colleagues shared their findings in a study published in the journal Communications Biology on Thursday.

A clue to the giant rhinos’ mysterious migrations

Scientists already knew about giant rhinos, or Paraceratherium, which have been found across Asia – mainly in Pakistan, Kazakhstan, Mongolia, and China.

But the new species, Paraceratherium linxiaense, shows that these prehistoric pachyderms made huge migrations across the continent.

In the early Oligocene era, 31 million years ago, giant rhinos moved out of the northern Tibetan plateau.

“Animal migration is linked to climate change. So 31 million years ago, when the Mongolian plateau dried up, they moved south,” Deng told CNN.

The new species, which is descended from those early migrants, indicates that giant rhinos made the trek back north during the late Oligocene. To get to Linxia, they would have had to cross the Tibetan plateau. According to Deng and his colleagues, this means the plateau must have been much lower than it is today.

“The weather got wet and they went back to the north,” Deng said. “Therefore, this discovery is of great significance to the study of the whole plateau-uplift process, climate, and environment.”

Read the original article on Business Insider

NYC rent is still pretty cheap, and it’s luring New Yorkers back to the city

New York City
Returning New Yorkers are taking advantage of affordable city rent.

It’s a fine time to be in New York City right now.

Covid cases are dropping as vaccination rates are rising, New Yorkers are staying out past midnight again, and rent is, by NYC standards, actually affordable. It’s proved the perfect recipe for the return of those who left the city as the pandemic raged.

The number of new Manhattan lease signings hit a record high since the Great Recession at 9,941 in May, per a report by appraiser Miller Samuel and brokerage Douglas Elliman. That’s four times what it was a year ago, and nearly 60% of these renters signed two-year leases.

As Bloomberg’s Oshriat Carmel wrote, New Yorkers are taking advantage of the city’s downtrodden rental market to plan their return, snagging concessions and discounts while they can at a long-term rate.

The pandemic saw the largest year-over-year declines on record for Manhattan, Brooklyn, and Queens, dropping 15.5% in Manhattan and 8.6% in the outer boroughs, per StreetEasy’s January Rental Report. The median asking rent in Manhattan was $2,750 – its lowest since March 2010, when rents dropped during the great recession.

“The pressures COVID placed on the marketplace created a unique opportunity to secure leases in prime locations and great buildings for significant discounts,” agent Ryan Kaplan, of Douglas Elliman, previously told Insider.

Many young professionals turned the plunging rents to their favor, upgrading to luxury apartments for $1,000-plus discounts that finally fit their budgets. Now, returning New Yorkers are catching on to the savings game.

Read more: New York City is back

New Yorkers are making their comeback

New Yorkers are returning in droves, Insider’s Avery Hartmans reported. She cited data from location-data firm Unacast, which found that migration to New York is growing twice as fast as in 2019.

Mansion Global previously reported the number of outward migrants from the NYC metro area ticked upward from 2019 to 2020 – a loss of 6.6 per 1,000 residents grew to 10.9 – but those who left for the suburbs were already returning.

“It’s preparation for a return to school, return to work, escape from your parents’ homes,” Jonathan Miller, president of Miller Samuel, told Bloomberg’s Carmel. “We’re undergoing a return back to normal life and this is part of it.”

As part of the return to normalcy, rent in the city has since begun to rebound. In April, it was no longer at the bottom of the market for the first time since the pandemic began, according to a follow-up StreetEasy report. But the same report says that the rebound will be slow.

Libertina Brandt reported for Insider in March that rents could stay widely cheap for the rest of the year.

As Nancy Wu, a StreetEasy economist, told Brandt, “Prices will continue to fall until the inventory settles a bit, more people come back to the city, more jobs are recreated from the loss of small businesses, and the city returns, somewhat, back to where it was before the pandemic started.”

Read the original article on Business Insider

Mexican president says migration meeting with Kamala Harris went so well he called her ‘president’

President of Mexico Andres Manuel Lopez Obrador and Vice President Kamala Harris
President of Mexico Andres Manuel Lopez Obrador and Vice President Kamala Harris arrive during a private meeting at Palacio Nacional in Mexico City, Mexico, on June 08, 2021.

  • Mexican President Andres Manuel López Obrador praised Kamala Harris after meeting her this week.
  • “It was such a good meeting that I called her ‘president,'” López Obrador told reporters Wednesday.
  • Harris held in-person meetings with Mexico’s president to discuss the migrant crisis.
  • See more stories on Insider’s business page.

Mexican President Andres Manuel López Obrador only had words of praise for “extraordinary” Vice President Kamala Harris after the two met to discuss the migration crisis this week, according to Reuters.

“It’s a completely new phase,” López Obrador told reporters during a news conference on Wednesday, Reuters reported. “It was such a good meeting that I called her ‘president.'”

López Obrador also said bilateral relations had broken new ground and that another top Biden administration official would visit next week for more discussions.

Read more: Court documents from the prosecution of a fake doctor who administered bogus vaccines give a glimpse into Kamala Harris’ thinking on immigration

Harris travelled to Guatemala and Mexico earlier this week as part of her efforts to address illegal immigration into the US – a trip she hailed as a success.

However, the vice president came under fire after she told Guatemalan migrants to “not come” to the US, doubling down on the Biden administration’s stance that migrants need to find a legal pathway into the country.

According to CNN, some White House officials were also “quietly perplexed” after Harris defended not yet visiting the US-Mexico border. So far, Harris has not given a date for that visit despite promising she would go in March.

López Obrador’s praise for the vice president offers a stark contrast to his thoughts on Former President Donald Trump, whose administration he once likened to Nazi Germany for its migration policies.

The number of migrants arriving at the US border has spiked since President Joe Biden took office, including hundreds of unaccompanied minors.

Read the original article on Business Insider

New Jersey accountants are advising clients to move out of the state to escape its high taxes and living costs

New Jersey Gov. Phil Murphy in 2019.
New Jersey Gov. Phil Murphy in 2019.

  • NJ accountants are advising clients to leave the state over high living costs, a survey shows.
  • The NJ Society of Certified Public Accountants said businesses were also concerned about high taxes.
  • People have fled high-tax states like New York, New Jersey, and California during the pandemic.
  • See more stories on Insider’s business page.

Accountants in New Jersey are advising clients to leave the state because of its high living costs and corporate and property tax rates.

Seventy per cent of certified public accountants (CPAs) have advised individual clients to leave the state because of the high cost of living, according to a survey by the New Jersey Society of CPAs (NJCPA).

And 53% of respondents said they had advised New Jersey-based business clients to consider relocation because of the state’s higher cost of doing business.

Read more: I’m a millionaire. Biden’s plan to raise my taxes is a great idea.

New Jersey’s high property-tax and corporate-tax rates, lack of available skilled personnel, and regulatory requirements were top concerns for businesses, the CPAs said.

“The tax structure here is one of the highest in the country, if not the highest, and that certainly is a negative issue for individuals and for businesses,” NJCPA’s CEO, Ralph Thomas, told CNBC, who first reported on the survey.

New Jersey has the highest top corporate-tax rate at 10.5%, the highest average property-tax rate, and the worst business tax climate in the US, according to the Tax Foundation.

And New Jersey residents spend on average 12.2% of their income on state and local taxes, the Foundation said – the third-highest in the US.

Thomas told CNBC that many of the people and businesses leaving New Jersey were choosing states with lower taxes and living costs, including Delaware, Pennsylvania, Florida, North Carolina, South Carolina, Tennessee, and Texas.

“Tax hell” in New York and New Jersey has triggered mass migration to Florida, according to the Sunshine state’s CFO, who called the two Northeast states “financial train wrecks.”

But people fleeing high-tax states like New York, New Jersey, and California during the pandemic need to watch out for other surprise taxes, a tax advisor told Insider.

In the New Jersey survey, the CPAs were more optimistic about the national economic recovery from the pandemic than New Jersey’s.

Thirty-six per cent of CPAs said they thought the state’s economy would get worse for the rest of 2021 compared with the first five months, while 30% thought the national economy would get worse. And 35% said they thought New Jersey’s economic condition would improve, compared to 43% for the country.

The CPAs said state legislature should avoid excessive regulations and invest in infrastructure to retain businesses.

Read the original article on Business Insider

The exodus of the ultra-rich to tax havens like Texas and Florida is accelerating – but people may still end up paying more tax than you’d expect

ron desantis florida vaccine 60 minutes
Republican Florida Gov. Ron DeSantis.

  • People have fled to low-tax states like Florida and Texas during the pandemic.
  • But they need to watch out for taxes they may still owe in the state they came from, a tax advisor said.
  • And states with no personal-income tax still have to generate revenues, so they tax other things.
  • See more stories on Insider’s business page.

People have been fleeing high-tax states like New York and California during the pandemic, leading to reports of an “exodus” to Florida and Texas – but people moving to avoid paying rates need to watch out for other surprise taxes, a tax advisor has said.

Though Florida and Texas have no personal-income tax, they still have to generate state revenue – so they hike up other types of tax, Alan Goldenberg, a tax principal at Anchin specializing in state and local tax, told Insider.

And even if you move to a low-tax state, you’ll still have to pay federal taxes, he added.

Read more: The 14 best neighborhoods in Austin, Texas, that young people, families, and one-percenters are moving to

Over the past decade, Florida’s population grew by 14.6% and Texas’ by 15.9%, according to US Census data. Both are around double the 7.4% rate of overall US population growth.

Meanwhile, California’s population grew by 6.1% and New York’s by just 4.2%.

And many of the super-wealthy are making the move to these low-tax states. Tax isn’t the sole reason why – but it is a “big part of the conversation,” Goldenberg said.

New York Gov. Andrew Cuomo plans to bump up personal-income tax for the wealthy to cover the state’s $15 billion deficit after its revenue fell during the pandemic. Combined with local taxes, New York City’s top earners would have to pay 14.7% income tax – which would be the highest rate in the US above California’s 13.3%.

People can make “significant tax savings” by relocating, Goldenberg said.

Florida’s CFO Jimmy Patronis told Fox Business that around 900 people a day are moving to the Sunshine state – and it’s mainly down to the “tax hell” in New York and New Jersey.

But Goldenberg warned that states with no personal-income tax still have to generate revenues, so they tax other things. These include sales, property, and tourism taxes.

Florida and Texas, for example, both have a 6% tax on stays in hotels – whereas California has none.

And Texas has high property taxes, too.

As well as considering these taxes, people have to watch out for whether they could still be charged in the state they moved from – known as their historic state.

“Just because you move out of the state doesn’t mean you may be totally done being taxed by that state,” Goldenberg said.

“There may still be some tax exposure,” he said, pointing out that people who own businesses in their historic state will still have to pay tax there.

Migration is leading to “significant revenue losses” for high-tax states, Goldenberg said. These states are increasingly chasing up people to check whether they have fully moved away, and are getting more aggressive in their approach, he said.

Because of this, people need to have a clear action plan and decide whether they want to keep, sell, or rent out the house in their historic state, Goldenberg said.

Read the original article on Business Insider

The wealthy were fleeing for low-tax states long before the pandemic slammed on the gas

miami beach
Florida is seeing its wealth increase at the expense of other states.

  • High-tax state residents were migrating to low-tax states pre-pandemic, per IRS data.
  • Low-tax states, especially Florida, are getting wealthier as a result.
  • BofA says ‘tax migration’ is far from a settled area but evidence of it is adding up.
  • See more stories on Insider’s business page.

Tax-induced migration was a key part of the narrative of 2020, but the story actually began long before that.

Lower-tax states are continuing to get richer thanks to a steady influx of new residents from higher-tax states, per a recent Bank of America Research note, which looked at recently released IRS data for tax returns from 2019, reflecting 2018 earnings.

The data showed that net gains in adjusted gross income (AGI) for lower-tax states were higher than those in higher-tax states: the latter saw $111 billion in AGI in 2018, while the former saw nearly $145 billion. The net AGI gain of lower-tax states also increased from 2017 to 2018 by $2 billion, to $34 billion, the team led by Ian Rogow wrote.

The rise of remote work prompted an outpouring of Americans, especially the wealthy, from big cities to more affordable areas in pursuit of sunnier locales and lower taxes. Tech elites from Silicon Valley have flocked to Texas, mirroring Big Apple financiers on the East Coast fleeing to Florida. But the IRS data makes it clear that the pandemic accelerated a pre-existing migration pattern.

It also confirms the anecdotal evidence that Florida in particular is attracting many wealthier residents compared to pre-pandemic times, and is seeing its wealth increase at the expense of other states. The average AGI per return of people migrating from Florida to New York in 2018 was $72,492. For those migrating from New York to Florida, it was $135,813. Florida gained a total of $7.3 billion of AGI from the top ten highest-taxed states.

People have “discounted” tax burdens as a move-inciting factor for some time, the BofA note reads, and while tax migration “remains an unsettled area,” leaders from high-tax states are becoming increasingly concerned that remote work and the SALT cap the federal cap on the state and local tax, which was slashed to $10,000 during Trump’s 2017 tax cut – are making residents question living there.

But not all is lost for big cities, which make up a good chunk of revenue for high-tax states. Consider New York City: Those who left during the pandemic are already returning in droves. USPS data released last month showed that nearly half of the Manhattanites who moved to Florida plan to move back. The city also still remains home to the highest number of ultra-net-worth individuals in the world.

A separate BofA Research report from May argued that reopening will spark a return to both NYC and San Francisco. “Both have the potential for some recovery in the near term,” the note reads. “NYC and SF remain premier cities for young renters given their status as economic, financial, and cultural centers, and the pullback in rents over the past year helps affordability.”

It seems that, for some Americans, big cities will always have an allure. But, as evidenced by the pre-pandemic migration trend, others are increasingly ditching them for a more affordable way of life and better savings.

Only time will tell whether high-tax states become truly overrated.

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How big-city suburbs won the 2020 migration boom

suburban houston city
The suburbs of Houston, Texas.

  • Large-city suburbs saw the biggest gain in residents during the pandemic migration, per Jefferies.
  • This will give nearby cities a needed economic boost, but it’s making the suburbs a cutthroat place.
  • Most urbanites moved to these suburbs or temporarily, making the migration more of a reshuffle.
  • See more stories on Insider’s business page.

2020 was the year urbanites took flight. But many of them didn’t go very far.

The pandemic’s great migration boom mostly consisted of urban dwellers leaving big cities for its directly outlying suburbs, according to a recent Jefferies note that analyzed the latest USPS data. “Large central metro” areas like New York City and Houston saw the biggest exodus, while “large fringe metro” areas saw the biggest influx of residents.

The trend is evidence that city dwellers sought more space during the pandemic but still wanted to remain close to cities – where employers and entertainment are – when the economy began to reopen, Jefferies states. Consider the San Franciscans who headed out to Sacramento or Oakland, or the New Yorkers who moved east to Long Island.

They’re all areas still within short traveling time to major cities, which Bloomberg has described as a reflection of an expanding regional labor market. Through spending as visitors rather than residents, it’s likely that these urban movers will help boost big cities, which stand to see an estimated 10% drop in spending due to a remote economy.

While fewer big-city residents have moved this year amid an economic reopening and rising vaccination rates, migration into the suburbs of large cities has still remained strong during the first few months of the year. It stands to reason, then, that big cities could also get a spending hit from suburbanites new to the area in addition to its former residents.

Big cities may still reap benefits from outlying populations, but the suburban scene itself is getting cutthroat. Jefferies anticipates the trend will continue to fuel the demand for suburban, single-family homes, which heated up a real estate market to the point of a historic housing shortage and record-high prices.

The reshuffling of America

To be sure, big-city suburbs aren’t a hot spot for everyone.

Some urbanites kissed their metro areas goodbye for good, preferring a life in the countryside or a more removed suburb. And others left for a new state entirely. About 9,000 Manhattanites who moved to Florida plan to stay there permanently, per USPS data. But it’s also likely that, considering the continued strength of migration to big city suburbs while migration from big cities stabilizes, state movers are also choosing suburbs in large metro areas.

There are also the migrants who moved only temporarily, intending to return to big city life. As a Bank of America Research report from May puts it, the urban flight is “more myth than reality.” It argued that economic reopening will spark a return to big cities like New York City and San Francisco.

Read more: The urban exodus out of New York City and San Francisco is more myth than reality

“Both have the potential for some recovery in the near term,” the note reads. “NYC and SF remain premier cities for young renters given their status as economic, financial, and cultural centers, and the pullback in rents over the past year helps affordability.”

In NYC, some of those who left for the suburbs are already returning. And the 10,000 other Manhattanites who moved to Florida, according to USPS data, plan to move back.

Whether urbanites moved temporarily or to the suburbs, one thing is clear: The migration of 2020 is more of an urban reshuffle than anything.

Read the original article on Business Insider