In the weeks leading up to Zohran Mamdani's historic victory in the New York City mayoral election, a stark narrative took hold. Conservative voices, led by outlets like the New York Post, issued dire warnings that the democratic socialist's proposed tax increases on the ultra-wealthy would trigger a mass exodus of millionaires to low-tax havens like Florida and Texas.
The Prophecy of a Ghost Town
The campaign of fear reached a crescendo just before the vote, with claims that "nearly a million" people were preparing to flee a city they claimed would be ruined by Mamdani's policies. The implication was clear: the economic engine of the Big Apple would sputter and die as its wealthiest residents took their capital and tax contributions elsewhere.
However, a month after Mamdani's win, the predicted flight has failed to materialise. Instead, the evidence points in the opposite direction. According to a report in Fortune magazine, signed contracts for Manhattan homes priced above $4 million actually increased in November compared to October. Furthermore, inventory in the luxury property sector fell by a significant 16% in October year-on-year, indicating stronger demand and a commitment to stay.
Why the Wealthy Are Staying Put
Experts in migration and taxation patterns say this outcome is not surprising. Cristobal Young, an associate professor of sociology at Cornell University and author of 'The Myth of Millionaire Tax Flight', explains that high-income individuals are statistically among the least likely to relocate. "Rich people are not the folks who are, you know, pulling up camp and moving to a different part of the country. That's just not who's doing that," Young stated.
The reasons are deeply rooted in social and economic attachment. The wealthiest Americans are more likely to be married and have children, factors that dramatically reduce mobility. "It's one of these things that's part of the spoils of economic success in life," Young notes. Their lives are embedded in networks of business, culture, and family that are not easily replicated or moved.
This pattern is supported by international evidence. Quentin Parrinello, policy director at the EU Tax Observatory, cited studies from Scandinavia and France showing that while mobility among high-net-worth individuals exists, "it is extremely limited." The allure of a global metropolis like New York—with its unparalleled cultural offerings, business opportunities, and fixed assets—often outweighs the financial impact of a modest tax increase.
Learning from Other States
The academic research provides a robust counter-argument to the exodus theory. Young and other researchers have analysed the introduction of similar wealth taxes in states like New Jersey, California, Connecticut, and Massachusetts. They found little to no evidence that these policies caused a mass departure of wealthy residents.
While a handful of individuals on the margin may decide to leave, the overwhelming majority stay and continue to contribute to the local economy. "What you need to think about is the fact that 98% of high-income earners are going to stay in the city, and they'll be paying that new tax rate, and they'll be contributing more revenues," Young emphasised.
Parrinello echoed this, stating that for most, "the complexities of moving away from these opportunities ultimately appear bigger than what you will pay in tax—particularly when the proposed tax rise is somewhat modest at the aggregate level of taxes paid."
The early data from New York City's property market, combined with decades of sociological research, paints a clear picture: the feared millionaire exodus is a political myth, not an economic reality. The city's wealthiest appear to be digging in, not packing up.
