For years, New York City has been the place to live for academics, artists, and those with Wall Street jobs. With real estate prices soaring and vacancies low in highly sought neighborhoods, it seemed impossible that NYC would ever lose its status as the greatest city in the world to live and work. Post-pandemic, the outlook for the city is dramatically different, with more and more people considering migration out of NYC, following the thousands that have already made a move.
Wall Street Workforce Looking for the Hamptons Lifestyle, Year-Round
The U.S. Postal Service reports that 300,000 people filed for a change of address forms during the pandemic. While some requests indicated that people had moved to places as far away as Honolulu, Hawaii, many requests listed residences in the Hamptons as their new addresses. For some people with NYC jobs, these moves were temporary. Now that NYC COVID restrictions are lifted, these individuals may return; however, many more are moving to the Hamptons permanently.
Telecommuting Is Here to Stay
New Yorkers are now living in the Hamptons year-round because their work situations may now make it possible for them to complete all of their daily job tasks without ever leaving home. Employees at large corporations began pushing for telecommuting work arrangements long before the pandemic. Still, many businesses resisted, believing that having their workforce at home would negatively impact productivity and morale. The pandemic forced the issue, and many companies have been pleasantly surprised at the results. As a result, many employers have decided to permanently allow employees to work from home if they wish or have opted to shutter their offices entirely. This has opened the doors for those who once kept the Hamptons, New York, as a weekend getaway to relocate there.
Concerns About Taxation
For wealthy individuals, migration to the Hamptons makes good financial sense. New York State assesses an 8.3 percent income tax on high earners, a considerable tax burden compared to the rates in other states. Those who choose to make New York City their homes must pay an additional 3.9 percent to the city, meaning that the wealthiest New Yorkers pay 13 percent of their income in taxes. Simply moving out of the five boroughs could save high earners thousands of dollars every year.
Employers Are Leaving Too
Individuals aren’t the only ones who are leaving New York City. Goldman Sachs moved one of its divisions to Florida, and other financial institutions have followed their lead. Some of these plans were in the works before the pandemic and spurred by looser regulations and lower tax rates found in other states. The pandemic expedited the execution of these plans, leading many companies to realize that having their base of operations be at a prestigious New York City address is no longer as important as minimizing their bottom line. As more large employers leave the area, the appeal of living in NYC continues to shrink.
Shifting Priorities Post-Pandemic
The pandemic has caused many people to reassess what’s most important in life. Some of those who left the city with the intentions of returning when COVID-19 restrictions ended discovered that they preferred the slower pace and quieter setting that the Hamptons and other communities had to offer. Now that the world is beginning to return to normal, they are reluctant to give up the increased time with family, the more peaceful setting, and the other benefits of living far from the Five Boroughs.
New Perks to Hamptons Living
One of the reasons people remained in the Big Apple for so long is a belief that it was possible to have a higher standard of living in NYC. Those who perhaps yearned to leave ultimately decided that they could not because it would mean losing access to New York’s elite private schools, high-end stores, and world-class restaurants. COVID-19 has changed those prospects. Realizing that many New Yorkers had relocated, luxury retailers like Jimmy Choo and Giorgio Armani opened stores in the Hamptons. One leading Manhattan prep school established a satellite in the Hamptons. Schools and other businesses that cater to elites are willing to go where they are, giving top earners one less reason to return to NYC.
Concerns About Ripple Effects
Some people who are thinking of joining the current NYC migration are more worried about the future than the present. With the number of individuals who have already relocated, New York City anticipates having a $9 billion budget shortfall this year. This will inevitably lead to cutbacks for public transportation, schools, and other services that New Yorkers rely on. In addition, the growing number of vacancies throughout the city is sure to cause property values to plummet and many service businesses to shutter. New Yorkers who have the means to move may wish to do so now before the situation in the city becomes bleaker.