High Tax Brain Drain & Record luxury real estate

Florida’s ability to attract high earning young people is a key variable in the #LongMiami thesis because it is a powerful forward looking metric. I never thought to call it a “brain drain” but will be doing so from now on, starting with a talk I am giving next week. I am happy to see the WSJ embracing the change unfolding.

And a bit of a human interest story before we dig into numbers:
Also reported in the WSJ this week, it turns out that the seller of Jeff Bezos’ second Indian Creek house is suing, saying he would not have accepted a price reduction if he had known that the buyer was Bezos. The house was listed for $85M, and the seller accepted $79M. He feels he lost out on $6M for this Billionaire Bunker’s house and is suing, saying that the identity of the buyer was hidden. Interesting to see that even Mr. Jeff Bezos negotiates 🙂

To be fair, the previous owner purchaed the house in 2014 for $28M. He still got a 182% increase after the reduction.

Our states ability to attract high earning young people is a key variable in the #LongMiami thesis because it is a powerful forward looking metric. I never thought to call it a “brain drain” but will be doing so from now on, starting with a talk I am giving next week. I am happy to see the WSJ embracing the change unfolding.

And a bit of a human interest story before we dig into numbers:
Also reported in the WSJ this week, it turns out that the seller of Jeff Bezos’ second Indian Creek house is suing, saying he would not have accepted a price reduction if he had known that the buyer was Bezos. The house was listed for $85M, and the seller accepted $79M. He feels he lost out on $6M for this Billionaire Bunker’s house and is suing, saying that the identity of the buyer was hidden. Interesting to see that even Mr. Jeff Bezos negotiates 🙂

To be fair, the previous owner purchaed the house in 2014 for $28M. He still got a 182% increase after the reduction.

Knight Frank 2024 Q2 Edition Super Prime Intelligence Report

I found some very interesting data points this week in the Knight Frank 2024 Q2.

The findings of the report that are very much in corroboration with the huge growth in Miami & South Florida’s high price-per-square foot sales I keep talking about.

Their findings quantify the growth of super luxury on a global scale. And in many ways, their report paints the picture of concurrent wealth gap polarization on shifts in financial polarities.

“Substantial wealth creation has supported the growth in the global super-prime sales market. The transformation of markets like Dubai, Palm Beach and Miami has more than offset the slowing experienced by some more mature markets. With rates moving lower total transaction volumes are likely to tick higher into 2025.” – Liam Bailey, Knight Frank’s Global Head of Research

Notice that two of the three places mentioned by their Head of Research are ini South Florida.

We have Palm Beach and Miami mentioned alongside Dubai as the most transformative markets.

According to Knight Frank, in Q2 2024: Miami was 4th in the world for sales past $10M.

This is a reflection of two things:
-> ongoing wealth polarization
-> the shift in financial polarities within the US as taxpayers and businesses leave high tax states

The underlying forces pushing these momentum cycles are unlikely to go away, and I see this as still early days.