Washington Millionaires Flock to Florida Real Estate as New Income Tax Looms

A new tax on high earners in Washington state is fueling a surge in luxury real estate purchases in Florida, as wealthy residents seek to escape a punitive tax environment before the levy takes effect in 2028.

The legislation, signed by Gov. Bob Ferguson after passing the Democratic-controlled Legislature, imposes a 9.9% tax on annual adjusted gross income above $1 million. Washington currently has no individual income tax, making the change a significant shift for the state. The tax is already facing a court challenge over its constitutionality, but real estate insiders say it is already influencing relocation decisions.

«I would say that the first thing is taxes. Income tax in Florida is 0%, and in Washington state, it's 9.9% as of January 2028,» Margit Brandt, a luxury property specialist, told Fox News Digital. «Capital gains in Florida is also 0%, and in Washington state, it's 7%. I just think that they've created this really punitive tax environment that's unappealing to the high-net-worth individuals who are the high earners in Washington State, and that's been the biggest kind of feeder for our market here.»

Washington's capital gains tax is tiered, with the first $1 million in taxable gains subject to a 7% rate and amounts above that taxed at 9.9%. Real estate is exempt from the tax, but the new income levy is prompting many to consider a move.

Brandt said the trend is not theoretical. «We've seen actual deals — big deals — happen with high earners from Washington state,» she said. «This is not hypothetical. These are closed transactions with people setting up a whole new life here in Florida.»

While comprehensive migration data is not yet available, a recent survey by the Association of Washington Business found that 24% of respondents are considering moving their businesses out of state, up from 17% the previous quarter and nearly triple the rate from 16 months ago. Additionally, 55% of business leaders said they are considering moving their personal residence to another state, a figure that rises to 67% in Spokane County, near the low-tax Idaho border.

The exodus is also visible among high-profile individuals. Jesse Proudman, founder and CTO of privacy-focused AI platform Venice.ai, said in May that he was leaving Washington, warning that a region once known as a «startup sanctuary» has become increasingly hostile to business leaders. In April, Starbucks announced a $100 million investment to establish a support office in Nashville, Tennessee — a state with no individual income tax — where it expects to create 2,000 support jobs over five years. The company said those jobs will include new positions, work brought in-house, and some teams relocated from Seattle.

Beyond finances, Brandt said safety, culture, and quality of life are key drivers for wealthy transplants moving to Florida, as well as Texas and the Carolinas. «If they're looking at a $10 million house, a $20 million house, a $50 million house, or a $100 million house, it's more than just a house. It's a whole new lifestyle,» she said. Florida's lack of a state estate tax and its proximity to the Caribbean also appeal to multi-generational wealth. «They want safety, security, good schools, and to set up their financial future. Florida is just such an easy landing place, and I think we're going to see way more of it in the coming years.»

A spokesperson for Sen. Patty Murray, D-Wash., said the issue is subject to an initiative currently on the ballot in Washington, limiting what she can say. Fox News Digital also reached out to Sen. Maria Cantwell, Gov. Bob Ferguson, State Sen. Jamie Pedersen — the architect of the millionaire's tax bill — and Seattle Mayor Katie Wilson for comment.

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Connor Quincy

Technology Reporter

Connor Quincy covers public affairs, politics, business, culture and daily news for Core Memo. The role focuses on verification, context, and clear explanations for readers.

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