How Wealth Migration to South Florida is Reshaping West Palm Beach Real Estate

Finding Success and New Beginnings Down South

Moving to West Palm Beach? The best time to do so is now. That’s because West Palm Beach is currently undergoing a remarkable resurgence, with a significant influx of people, businesses, and money flowing into the city.

Read on to learn more about this wave of migration that’s sweeping West Palm Beach and the opportunities that come with it.

DEFINING WEALTH MIGRATION AND ITS GENERAL IMPACT ON WEST PALM BEACH

NomadCapitalist.com refers to wealth migration as “a tool that rich investors and entrepreneurs use to protect themselves so they can pursue financial and personal freedom.” The article further mentions the United States as among the countries where a good number of wealthy foreign investors (particularly moneyed Chinese) still want to go in search of the “American dream.”

Meanwhile, global investment adviser Henley & Partners notes that wealth migration ensures high-net-worth migrants a Plan B as a way to keep their competitive edge in the global investment game.

All these considered, let’s zero in on the trend of wealth migration to Florida, particularly in West Palm Beach.

In the years following the COVID-19 pandemic, the Southeast, including West Palm Beach, has experienced substantial growth in population, economy, and opportunities. This surge is attributed to the increasing number of foreigners relocating from the north of the country to settle in the region. Those moving to West Palm Beach are primarily from New York, New York; Boston, Massachusetts; Washington, DC; Chicago, Illinois; and Los Angeles, California.

As thousands of businessmen, capitalists, investors, professionals, and families make the South their new home, they bring with them substantial wealth – approximately $100 billion, as estimated by recent Internal Revenue Service (IRS) data.

While many cities across the country faced economic challenges during the pandemic, including business closures and job losses, it is only now that local economies are regaining strength post-COVID. Surprisingly, Florida stands out as one of the states that sustained genuine economic progress, even at the peak of the pandemic.

WHAT’S CAUSING THE MIGRATION

The migration trend to the Southeast, particularly in West Palm Beach, is driven by various factors that attract individuals and families, not just for seasonal stays but for permanent resettlement and business ventures.

One key factor is the pursuit of new opportunities for business growth, personal development, and overall fulfillment by affluent individuals and families from the northern regions. The pandemic lockdown emphasized the importance of well-being, prompting the realization that a fulfilling life is possible in a better environment. So, the appeal of living in a paradise-like setting became a compelling motivation.

In recent years, Palm Beach County observed an increase in foreigners settling in the area, particularly high-level executives who were not typical seasonal visitors. These executives were purchasing vacation homes in the state while conducting business either elsewhere in the country or overseas. Recognizing this trend, Palm Beach County strategically initiated a migration-driving strategy nearly a decade ago, targeting businesses and entrepreneurs. According to Kelly Smallridge, CEO of Palm Beach’s Business Development Board, this initiative has become the most lucrative economic development effort in the last 40 years.

Presently, Palm Beach County, including West Palm Beach, boasts 44 billionaires – a number that’s expected to rise as more companies, families, and professionals relocate to the region. Florida, with its healthy and supportive business environment and absence of personal income tax, is an attractive destination for relocation, with Palm Beach and West Palm Beach standing out among the state’s cities.

Recently, corporations like hedge fund Elliott Management and Citadel Securities made the move to the county. With the migration, they brought new business, funds, job opportunities, and, of course, their families – significantly adding more luster to the local economy. Mayo Clinic, the renowned medical center previously based in Minnesota, now calls Florida its home, bringing along with it its 9,000 employees.

In 2022, more than 13,000 new residents migrated to Palm Beach County, contributing over $7.2 billion in new income, making it the second-highest in Florida after Miami-Dade County, according to the Census Bureau. The Economic Innovation Group, for its part, analyzed the IRS income migration data from 2020 and 2021 and discovered that Florida achieved the highest adjusted gross income net at $39.2 billion, with $9.8 billion resulting from wealth migration from New York. The report also indicated that 27.7 cents of every dollar leaving Manhattan benefited Florida, totaling an estimated $4.6 billion.

Palm Beach County benefited significantly, enjoying an adjusted gross income of $7 billion, with a whopping $1.1 billion coming from New York migration alone.

West Palm Beach, in particular, has emerged as the preferred destination for relocation in the Sunshine State, offering more affordable housing, vibrant commercial spaces, and attractive tax incentives, surpassing Palm Beach and Miami Beach. The city is also strategically positioning itself to welcome even more companies from the marine and medical industries, identified as key sectors for future growth.

Another perk of the migration: The substantial growth in population and influx of wealth has kicked off the establishment of additional businesses to meet the evolving needs of the community. This expansion spans various sectors, including housing, construction, retail, schools, and services. All these are great for community building, especially as West Palm Beach is opening itself up to more families. Moreover, these secondary businesses are adding new posts in the local job market, creating employment opportunities and contributing to wage increases.

On a broader level, the migration of wealth is reinvigorating the real estate market. Prospective buyers are not only exploring residential options but also considering office spaces.

Around two decades ago, the local economy heavily relied on tourism and real estate. Today, however, there has been a diversification, with real estate, finance, insurance, and professional/business services experiencing significant growth. Jerry Parrish, the chief economist of Florida State University, notes that these three main industries collectively contributed to an impressive 53% of the county’s GDP growth from 2010 to 2021.

In 2021, Palm Beach County boasted 73,989 employed professionals in the finance sector and 66,144 in real estate. The real estate sector alone generated $5.7 billion in income for the county. Corporate headquarters employment witnessed a remarkable 118% growth in one year, resulting in the creation of 17,000 new jobs.

WHY YOU SHOULD BE MOVING TO WEST PALM BEACH

Why are northerners relocating to the South, and why West Palm Beach in particular? Though not as renowned as Miami and Palm Beach, West Palm Beach possesses its own charm and influence. Earning the title of the “Wall Street South,” West Palm Beach is shedding its image as a winter vacation spot for snowbirds and retirees and transforming rapidly into an economic hub due to the ongoing migration.

As the oldest incorporated municipality in Florida since November 5, 1894, West Palm Beach may be small – covering just about 58 square miles – but it is home to roughly 121,000 residents (as of 2022 US Census estimates).

Tagged as one of the most attractive cities to live in, West Palm Beach stands out, not only for its laid-back beach culture, pleasant weather, and small-community vibe but also for its lenient and supportive pro-business environment. Forbes Magazine even recognized West Palm Beach as the number one city for business and careers. That’s why it’s no surprise that everyone across the board from tourists and home buyers to entrepreneurs and established corporate entities wants a piece of this little tropical paradise.

Palm Beach may be posher and more popular but West Palm Beach possesses its own allure as a more approachable, family-friendly, and low-key destination. With less traffic, more manageable business operating costs, and a plethora of activities, West Palm Beach is also gaining traction as the new destination for up-and-coming restaurants, delighting foodies in the area. After a challenging workday, residents may simply head back to West Palm Beach and spend the remainder of their day at the beach or bonding with family at various local establishments, attractions, and food spots.

As a “magnet for migration,” West Palm Beach is solidifying itself as a thriving hub, witnessing a surge in interest in its real estate market. In January 2024, West Palm Beach real estate increased by 1.2% compared to the previous year, with the median price of a home pegged at around $418,000. While this represents an increase, it remains relatively more affordable than its Palm Beach counterpart, where the median home listing is $1.9 million.

Florida is also emerging victorious in the migration competition. According to a 2022 study by the National Association of Realtors, Florida accounted for 23% of foreign purchases in the country. Additionally, South Florida experienced a 78% uptick in foreign driver’s license transactions in 2023 compared to 2022, underscoring the substantial population growth of new residents calling Florida their new home.

MORE REASONS TO LOVE WEST PALM BEACH

As the thriving city of West Palm Beach experiences an unprecedented surge in migration and economic growth, the opportunities it presents are more enticing than ever. Imagine calling a vibrant coastal city your home and raising your family here. Moreover, the professional landscape here is ripe with the potential for growth, offering not only a chance to advance your career but also providing fertile ground to leverage success for your business.

If you’re contemplating moving to West Palm Beach, consider our list:

1. A balanced life made possible

Even pre-pandemic, people were migrating to West Palm Beach. However, with the COVID-19 health crisis spreading worldwide, individuals were compelled to reflect on their true priorities and the life they desired to live. This shift in perspective led many to fulfill their dream of living by the beach, prioritizing family life and striving for work-life balance. West Palm Beach provided (and continues to provide) a genuine opportunity to achieve these goals, eliminating the need to compromise family for work. West Palm Beach real estate offers a variety of properties to fit every lifestyle, budget, and requirement.

2. Goodbye to stressful and inconvenient office culture

West Palm Beach offers a relaxing and laid-back lifestyle, safe and close-knit communities, easy commuting, and a supportive and healthy business environment for those aspiring to start their own enterprises. While some corporations still adhere to the traditional office space model, many others support remote or hybrid work, attracting a more diverse, younger, and dynamic population of professionals. With the rise of the remote work concept, many are embracing the digital nomad lifestyle and opting to work under ideal conditions, say, by the beach.

3. Big corporations are stimulating the local economy

The influx of businesses and people to Florida is injecting $100 billion in new income into the southeast (as of 2020 and 2021). And more corporations have migrated since, causing a significant shift in economic muscle in the country. This change is positive, considering the vast space and potential in Southeast Florida, especially in West Palm Beach. Increased business activity spurred positive effects on the local economy, job growth, community building, and more. Compared to the pre-pandemic period, job employment numbers have nearly doubled, with two-thirds of total job growth in the US attributed to the southeast.

4. Special tax privileges

For corporations and smaller entrepreneurs, West Palm Beach presents an exciting, relatively low-risk location with immense potential. To foster business growth, the city offers numerous financial incentives, including tax exemptions and expedited permit reviews. The magnitude of incentives is based on the size of the company, with the city tailoring privileges to the number of jobs created, making it a mutually beneficial arrangement.

HOW WEALTH MIGRATION IS AFFECTING WEST PALM BEACH REAL ESTATE

Many new people coming in for business opportunities in West Palm Beach, whether they’re corporate giants or career starters, are staying for the long term. Many of them are bringing their families with them. Of course, they’ll need roofs on their heads. Moreover, a number of these big businesses will also be looking for spaces to conduct their operations.

This is where West Palm Beach’s real estate sector comes in. The burgeoning demand for commercial and residential real estate is putting more strain on the already-scarce property inventory. As more buyers of West Palm Beach, FL homes and office spaces are jostling against each other for available properties in the market, those with bigger pockets are resorting to cash purchases to stay ahead of the bidding wars and attract seller attention.

Palm Beach, known as the sophisticated sister city of West Palm Beach and dubbed “The Hamptons of the South,” continues to uphold its elite status. August 2023 figures by the Miami Association of Realtors revealed that an astonishing 84% of Palm Beach condos and townhouses were sold via cash transactions, marking a staggering 78% jump from 2019 stats.

However, West Palm Beach is quickly catching up, with new projects and property developments in progress, promising additional housing options that address the issue of property stock scarcity.

INVESTING IN WEST PALM BEACH TODAY

There’s no better time than now to invest in commercial property and homes in West Palm Beach, FL. The surge in demand has been bumping up property values in the city and experts predict that this upward trend is bound to continue.

February stats from Realtor.com show that homes in West Palm Beach were sold for a median price of $380,000, a better performance compared to the previous year’s $365,000. Some of the most popular neighborhoods in West Palm Beach include

• Ibis Golf & Country Club
• Downtown West Palm Beach
• Emerald Dunes
• Colonial Estates
• El Cid

As for rental properties, the average rent for a West Palm Beach apartment as of November 2023 is $2,232 while the average size of rentals is 951 square feet. Popular neighborhoods for rentals include

• Southside West Palm Beach
• Old Northwood
• Roosevelt Estates
• Villages of Palm Beach Lakes
• Golden Lakes

WHAT’S AHEAD: SUSTAINING GROWTH AMID CHANGING DYNAMICS

With the encouraging migration and influx of wealth into West Palm Beach, Florida, the current challenge lies in aligning the city’s development of facilities, amenities, and property inventory to ensure sustained growth.

The city has already taken significant strides in this direction. Related Companies, a company owned by Miami Dolphins owner Stephen Ross, is investing in West Palm Beach and spearheading the redevelopment of The Square, a project initiated in 2000. Spanning 35 acres in the downtown area, this mixed-use development includes retail, commercial, residential, and office buildings. Complementing these efforts are plans to establish more public and private schools.

Beyond constructing another office building in a prime city location, Related Companies is set to launch its condo project – two 28-story towers with units starting at $7.5 million. Additionally, plans for building more affordable mixed-use projects and multi-family units are underway. The ultimate goal is to add to the real estate inventory, providing options for various income demographics and not just the ultra-wealthy and ultimately making West Palm Beach accessible to a diverse population.

Gone are the days when Florida was solely known as a state for retirees and snowbirds. In this new chapter, Florida – particularly West Palm Beach – emerges as a rising economic powerhouse that’s attracting young, dynamic entrepreneurs and professionals. Apart from business success, the city also promises a lifestyle of balance and relaxation.

BE PART OF WEST PALM BEACH’S GROWTH

West Palm Beach invites you to relish the perks of urban living in a city that merges economic muscle with a boho lifestyle. Become one of the success stories of this migration trend and secure your piece of highly coveted West Palm Beach real estate with the assistance of the Frisbie Palm Beach Team, led by top South Florida Realtor Suzanne Frisbie. Our team provides the best options tailored to your needs and lifestyle, ensuring a seamless and stress-free home-buying experience.

Choose the expert Realtors in West Palm Beach – contact us at 561.373.0941 or send us an email to turn your dream of living in West Palm Beach into a reality.