NAR, Realtor.com. Builders, Mortgage Bankers Economists Expect Home Sales, Rates Will Improve in 2025
Yun noted that a key trend going forward is that for-sale inventory has been increasing of late and is expected to continue next year.
In 2021, the net number of taxpayers leaving the State was still higher than in 2019 at every income level, with the greatest increases for those with incomes over $500,000 (more than double that in 2019) and at incomes below $50,000 (76 percent greater than 2019).
ALBANY—Shortly after a Fiscal Policy Institute study found that the migration of high-income earners out of New York City had dropped substantially after the COVID-19 pandemic subsided and a greater share of workforce (middle-class families) are leaving the state, comes a newly released report by New York State Comptroller Thomas DiNapoli that reveals the pandemic caused a significant shift in taxpayer movement, with net out-migration quadrupling in 2020 compared to the prior year.
While declining in 2021, the net number of taxpayers leaving remained one-third greater than the pre-pandemic average, according to the report, which examined personal income tax filings for the pandemic years of 2020 and 2021.
The State Comptroller’s report released on Dec. 5 found that more than one of every 100 resident personal income tax (PIT) filers left New York State in 2020. The COVID-19 pandemic caused a significant shift in taxpayer movement, with net out-migration quadrupling in 2020 compared to the prior year. While declining in 2021, the net number of taxpayers leaving remained one-third greater than the pre-pandemic average.
“The pandemic upended everyone’s life and caused a big shift in the movement of New York taxpayers in 2020,” DiNapoli said. “While patterns shifted closer to pre-pandemic trends in 2021, net out-migration rates remained higher, particularly for families. Policymakers need to make sure the state remains an attractive, affordable place to work and to live. Doing so will help maintain the state’s largest revenue source to ensure vital services continue in order to provide a high quality of life for all New Yorkers.”
PIT is New York’s largest revenue source, with $60 billion in tax liability paid by 10.9 million taxpayers in 2021. Despite the recession of 2020, the number of taxpayers grew, likely due to high financial market levels and enhanced unemployment benefits that increased personal income. In 2021, the number of filers declined, but was slightly greater than the number in 2019.
The vast majority (87% in 2021) of PIT filers were residents; 10% were non-residents who only pay New York PIT on income received from work, businesses or other income sources located in New York. An additional 3% are part-year residents who file a return if they move into or out of the state, according to the report.
The 2020 increase in filers was concentrated in full-year resident taxpayers, up by 161,679. The 2021 decrease was also attributable to these taxpayers, down by 235,000 compared to 2020 and 73,500, or 0.8%, lower than 2019. Most of the decline in 2021 was concentrated at incomes less than $100,000, partially offset by an increase in the number of higher-income filers. The number of nonresident taxpayers declined in 2020 but bounced back in 2021, exceeding pre-pandemic levels at all income thresholds.
The number of part-year filers increased in both 2020 and 2021 and was 19% greater in 2021 than in 2019, building on a steady increase in part-year resident PIT returns filed since 2009. Nearly two-thirds of filers who moved out in 2021 retained no New York source of income after they left, suggesting a potential loss of economic activity, according to the report.
From 2015 to 2019, there was a consistently larger number of taxpayers leaving the state than coming in, with an average annual net out-migration of roughly 28,700 taxpayers during this period. In 2020, the number moving out of state increased dramatically, resulting in a net out-migration of nearly 112,500—almost four times the number in 2019.
In 2021, the number of people moving into the state rebounded and was more than one and half times over the year prior, and was also higher than the average in-migration from 2015 to 2019. Still, the number of taxpayers moving out was greater, resulting in a net out-migration of over 39,200, more than one-third greater than the pre-pandemic average. In the aggregate, out-migration rates declined to just over four in every 1,000 taxpayers in 2021 from almost 12 in 1,000 in 2020. However, this rate was greater than the 2019 rate of three in 1,000.
The report stated: “In terms of the scale of out-migration, 2020 appears to have been an aberration, but the state has steadily experienced an increase in part-time resident filers and more people have been exiting New York than moving to the state on a net basis. …In particular, middle-class families have been leaving the state at the highest rates, and these rates, while lower than 2020, remained elevated beyond pre-pandemic trends in 2021.” This data is in agreement with the Fiscal Policy Institute study which concluded that a greater number of middle-class families have been looking for the exits and relocating out of New York State.
Single filers comprise the largest share of state PIT taxpayers, and accounted for over half of the net out-migration in 2020. Married and head-of-household taxpayers (families) also left New York at elevated rates in 2020, nearly double those in 2019. In 2021, families continued to exit New York at higher rates than prior to the pandemic. In 2021, an equivalent of one in every 100 married resident filers left New York. Married filers earning between $100,000 and $500,000 continued to experience the greatest out-migration, a trend that continued prior to the pandemic.
Both prior to and during the pandemic, the majority of taxpayers leaving New York City relocated to the two other downstate regions, with the largest number moving to Long Island. However, the number of city taxpayers moving to the other regions of the state more than doubled in 2020 and remained above pre-pandemic levels in 2021[/caption]
State net out-migration in 2020 was driven by a sharp increase in taxpayers leaving New York City. With the pandemic impacting the city earlier and more severely, net out-migration from the city to places both in and outside the state spiked, with over two in every 100 city residents moving out in 2020. The surge was driven by taxpayers who left the state altogether, and city residents represented 71.5% of the state’s net out-migration in 2020.
In 2021, the migration pattern shifted once again. The city experienced a net gain of 2,221 taxpayers. The gain was mostly attributable to taxpayers from other parts of the state, and would have been greater if not for a total net loss of 761 taxpayers who left New York. Prior to and during the pandemic, the majority of taxpayers leaving New York City relocated to the two other downstate regions, with the largest number moving to Long Island. However, the number of city taxpayers moving to the other regions of the state more than doubled in 2020 and remained above pre-pandemic levels in 2021.
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