Is Miami costlier than NYC? Why developers say the math favors Florida

While recent economic data suggests South Florida has lost its cost advantage over New York, top real estate developers argue the numbers fail to tell the full story.

Key executives behind major residential skyscrapers in Manhattan and Miami argue South Florida is playing long-overdue catch-up after decades of underpriced real estate, while still offering buyers significantly more long-term value.

“Miami has earned a seat as one of the greatest cities in the world,” Naftali Group EVP of marketing, sales and design Danielle Naftali told Fox News Digital. “As people have migrated down here, [and] made it a location that people are living permanently, obviously, things have become a bit more expensive… world-class restaurants opening here, the most amazing cultural institutions, entertainment, hospitality groups — everything that people really experience in major cities around the world. And, you know, those truly go hand in hand.”

“Globally, Miami was playing catch-up to New York for long periods of time, and you can do this by price per square foot, you can do it by total dollars, what they sell for, but Miami used to trade at — as a local myself — I almost thought it was weird how inexpensive the real estate was here comparatively to cities like New York or London or LA,” PMG Managing Director Ryan Shear also told Fox Digital.

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“A lot of people have moved down here, not just people, but companies and a lot of high-profile people, and you’re seeing big headlines about big trades and big sales and that’s true and that is great for the city. I don’t think it tells the whole story. I think Miami is still a value city,” he added. “I still think it’s a bargain play down here.”

A recent Bloomberg analysis of U.S. Bureau of Economic Analysis data found that the overall cost of living in the Miami-Fort Lauderdale-West Palm Beach metropolitan area has surpassed that of greater New York. The analysis separately found that housing costs in South Florida are roughly 5% higher than in New York and its suburbs. Additionally, consumer prices in South Florida have risen 36% since 2019, according to the U.S. Bureau of Labor Statistics, representing the second-highest inflation surge among major American markets, trailing only Tampa.

South Florida home prices have jumped 79% since the pandemic, according to S&P CoreLogic Case-Shiller data, while Florida’s average annual homeowner’s insurance premium stands at $8,292, roughly four times the average in New York state, according to Insurify.

“There’s definitely a price gap that has changed. But what we see ultimately is that buyers are less sensitive to the price per square foot as the buyers have become more sophisticated,” Naftali countered. “We see our buyers thinking about everything from lifestyle, services and amenities, finished palettes, and really the best quality. So this is something that people are really willing to pay that premium.”

“Anyone that’s buying in our development today will be able to see their appreciation over the next five to ten years,” she said.

Beyond homebuyer costs, developers also face nationwide borrowing and insurance pressures. However, Shear emphasized that constructing a high-rise in Florida remains vastly more accessible than doing so in New York.

“It is still less expensive to build in Florida than New York. And not by a little, by like a decent, significant amount,” Shear said. “Debt in Florida is the same as debt in Texas… Banks lend nationally and globally. So it’s still affordable to build in Florida.”

“Everything’s relative. You know, we’re relative to the world we live in. So, relative is South Florida trading at faster paces, absorption greater than what we see in a lot of markets… It’s not a Miami thing. I think Florida in general is having a very good moment. And it’s been going on for a while, and I don’t think it’s stopping,” Shear said.

Florida remains one of nine U.S. states with no individual income tax, whereas top earners in New York City face combined state and local income tax rates of nearly 14.8%. ATTOM data show Miami-area property taxes have jumped 62% since 2019. Florida voters, meanwhile, will consider a constitutional amendment in November that would exempt the first $250,000 of a homestead’s value from property taxes other than school district levies.

“There is definitely still tax incentive to Florida. That’s very obvious. What we see, though, especially in the luxury sector, is that global luxury buyers, it’s not that they’re either going to New York or either going to Florida. Most of those buyers have a home in both locations. So there’s definitely a tax benefit to being in Florida, without a doubt,” Naftali said.

“It’s just math. The effective tax rate, I believe, in New York, if you’re in the top tax bracket, is somewhere between 50 and 55%, depending on what borough and so forth. There’s no state income tax and there’s no city tax here. So the top tax bracket is set by the federal government, that’s it. That’s the math. If anybody would tell you different, it’s not an opinion, that just factually is the truth,” Shear argued.

“I think people have finally figured out that like living in Florida may just be a better life that they want, and that’s invaluable.”

– Ryan Shear

“I’ve read countless articles saying how real estate taxes are going through the roof. Well, it’s not the real estate tax going through the roof. There’s just more expensive real estate. It’s not that the tax rate is changing,” he continued. “But if you want to go to a city that’s checking all these boxes that somebody’s looking for — massive growth, massive job[s], large population, high rises and so forth — I think it’s impossible to find one. So again, to the point of relativity, it’s all relative to the next option. I think as an option, it does not get better than South Florida.”

U.S. Census Bureau figures show the Miami-Fort Lauderdale-West Palm Beach metro area’s median household income was $80,625 in 2024, about $1,000 below the national median of $81,604. The developers also pointed to infrastructure, permitting and school expansion as efforts to accommodate future population growth across South Florida.

While local median incomes may lag national benchmarks, Shear noted the region’s economic engine is fundamentally changing as major employers relocate their corporate headquarters, rather than just opening small satellite branches.

“It’s not just the people that are moving down here. People are moving their companies down here,” Shear explained, noting that PMG shifted its primary headquarters from New York to Miami. “We’ve reached a tipping point where you’re seeing companies… that are planting their flag in Miami and building companies or taking their existing company and moving them to Miami.”

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“I think specifically in Miami, people will continue to move down here. As we said, this is no longer a seasonal location, right? You have everything here,” Naftali said. “It’s a continuous progression. So when you talk about the next five years, it’s only going to continue to get better. So if you’re able to get in now and invest in a new development down here, I think it’s a great investment opportunity.”

“Ask people, where do you want to spend the rest of your life?” Shear said. “Not everything’s about price per square foot, and I still think it’s a value play down here, but I think it is about a lot more down in Florida… Work hours, quality of life, weather, state income tax, restaurants, who’s down here. I mean, Miami’s culture now is incredible… how lucky are we to experience the world’s cultures in one city? Fundamentally, people are moving down here and still are continuing to, not just because you save on taxes or there’s good sun. I think people have finally figured out that living in Florida may just be a better life that they want, and that’s invaluable.”

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