Wealthy homebuyers are increasingly looking to lower-tax, business-friendly states such as Texas as taxes and regulation play a bigger role in where affluent Americans choose to live and invest, according to Mauricio Umansky, founder and CEO of global brokerage The Agency.
“That trend is definitely happening,” Umansky told FOX Business of affluent residents leaving high-tax blue cities and states. “… But not only tax friendly — business friendly.”
Umansky, whose firm has 170 offices across 17 countries, said policies that raise the cost of owning or selling high-end real estate are affecting luxury markets.
He pointed to New York City’s pied-à-terre tax and Los Angeles’ Measure ULA, commonly known as the “mansion tax,” as examples.
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“The pied-à-terre tax is really hurtful,” Umansky said. “In Los Angeles, we have the ULA tax, which is very hurtful.”
Those policies are helping redirect some wealth toward markets, including Texas, he said.
“You are seeing a lot of the wealth go, and they’re going to places like Dallas, Texas,” Umansky said. “You’re seeing a lot of growth there. So there’s a shift.”
Texas is not the only market drawing interest. Umansky said buyers with greater flexibility are considering other parts of the country, including the Southeast, as remote work gives them more freedom over where they live.
Still, Umansky said the movement of wealth does not mean traditional luxury strongholds such as California and New York are collapsing.
“We’re definitely seeing a trend of exodus, but still growth,” he said, describing the market as a “very mixed” picture.
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Los Angeles is beginning to show signs of recovery at the high end, Umansky said, as sellers become more flexible on pricing and buyers begin making offers.
The Hamptons also remains strong, while California continues to generate significant wealth, including from the artificial intelligence boom. Both California and New York remain critical economic engines despite some residents looking elsewhere, Umansky said.
Umansky added, “I think it’s super imperative for our country that we continue to protect California and New York.”
His comments come as New York City faces scrutiny over its new pied-à-terre tax on luxury second homes, including recent criticism from billionaire investor Bill Ackman and Citadel founder Ken Griffin.
President Donald Trump argued in a Truth Social post Tuesday that the tax could ultimately cost the city more than it generates if wealthy property owners and taxpayers relocate to lower-tax states such as Florida and Texas.
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Trump’s comments came one day after a New York judge temporarily restrained Mayor Zohran Mamdani’s administration from moving forward with parts of the tax rollout after three homeowners sued over how the city implemented the surcharge.
Staten Island Supreme Court Justice Wayne Ozzi ordered the city to take down a disputed property roll covering more than 900,000 homeowners and temporarily barred officials from imposing or collecting the surcharge based on the roll without first making the individualized determination and providing the notice required under state tax law. A hearing on the dispute is scheduled for Aug. 31, while an appeal filed by the city triggered an automatic stay of the judge’s order.
The lawsuit challenges the administration of the tax rather than the legality of the surcharge itself.
FOX Business’ Brittany Miller contributed to this report.
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