It’s making more sense for wealthy to leave NYC: Councilman
NYC Council Minority Whip Joe Borelli on increased taxes in New York City and the trend of New Yorkers leaving the city and state.
What pandemic? Despite a steady drumbeat of Covid-19 cases around the country, the net worth of the wealthiest Americans dramatically rebounded in the five months ending in August—far outpacing growth in other parts of the world.
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According to a new report by wealth research firm Wealth-X, the richest North Americans—classified as those with a net worth of at least $30 million—have already recovered much of their pre-pandemic wealth. Their collective net worth grew 37%, to about $12.5 trillion from the end of March, a time when parts of the country were operating under shelter-in-place orders, to the end of August.
While that is a net decrease of 3% from the end of 2019, it dramatically outpaces the recovery of ultrahigh-net-worth individuals overseas. Global wealth is still 9% down from its levels at the end of 2019, according to the report.
The number of individuals in North America worth at least $30 million also rose 28% to 104,440 during that same period. That represents a major recovery from the first quarter, when the number of high net worth individuals around the country had dropped by 23% at the end of 2019. The number of ultrahigh-net-worth individuals in both the U.S. and globally is down by roughly 3% since the end of 2019.
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Maya Imberg, senior director of thought leadership and analytics at Wealth-X, attributed much of that rise to the stock market boom, which despite high unemployment numbers and lower corporate profits has essentially recovered all of the losses initially suffered at the beginning of the pandemic. “In the U.S., it’s been really extreme,” Ms. Imberg said of the recovery.
“Unlike in ‘typical’ recessions, the bulk of the damage to wealth holdings from the pandemic will most likely have been frontloaded,” the report says. “As the global economy rebounded in the second and third quarters of 2020 from its temporary cessation of activity, helped by extensive stimulus and support programs, there was a broad bounceback in financial markets and renewed opportunities for wealth creation.”
The report offers a glimmer of hope to New York City developers who are grappling with an excess of high-end condominium projects.
Manhattan residential sales were down 46.3% in the third quarter of 2020, compared with the same period last year, according to a recent report by Douglas Elliman. There are currently more than 20 months of supply of homes on the market, not including shadow new development inventory that is not publicly listed, the report shows.
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Elliman’s numbers do show that sales of higher-end apartments are outpacing those of entry-level units. Sales of homes priced at $5 million and above were down only 23.2% overall.
Before the pandemic, the superwealthy had a strong year in 2019, according to the Wealth-X report. Overall, the number of ultrahigh-net-worth individuals rose globally by 9.5% last year to nearly 291,000 individuals, a sharp acceleration from the previous year. North America recorded the strongest expansion of the ultrahigh-net-worth population world-wide, posting an increase of 14.5% in its ultrahigh-net-worth population and a 14.4% uptick in their collective net worth.
On the whole, North America has a 36% share of the world’s ultrahigh-net-worth population, the numbers show.
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