The mass exodus of wealthier people from dense cities such as New York and San Francisco will be a catastrophe for the cities if it keeps up. It will also be a disaster for the suburbs to which these affluent refugees are moving.
The escape of upper-middle and higher earners is “similar to the rush to grab toilet paper and people grabbing the biggest [house] they can find,” Sotheby’s real-estate agent Kevin McDonald told The Wall Street Journal. And emerging data back up the anecdotes. FlatRate Moving tells the Journal that “moves from New York City to Connecticut have more than doubled from the prior year.”
On the southern tip of Long Island, the Amagansett school district predicts enrollment will double. Bloomberg notes that Jersey suburbs are seeing the biggest price hike since before the housing bubble burst. Banks and law firms are looking for office space closer to where their workers live. The South and West are doing well, with Realtor.com seeing spikes from Little Rock to South Carolina.
It’s obvious that this is bad for cities. By a New York Times estimate, 420,000 people have left Gotham — and they skew richer and younger.
That means the Big Apple is at risk of losing a big chunk of its tax and consumer base: the audience for restaurants, high-end stores and culture. New York, San Francisco and other hubs may be left, disproportionately, with people who don’t have other choices: the homeless, poor elderly, families without the resources to compete for space away from the five boroughs — and with fewer tax resources to help them.
But it’s also bad for the ’burbs. Consider New York’s suburbs: our own suburban counties, Connecticut and New Jersey.
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