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Barron's 'Penta' ranks Palm Beach second-best for second homes

Posted On: 03-09-2013

By Aleese Kopf

Daily News Staff Writer

Palm Beach is the second-best retreat in America - jumping up from No. 15, according to authors at Barron’s Penta magazine, which recently released its list of the 20 best places for second homes.

Authors of the weekly supplement said Palm Beach “is slowly becoming America’s stylish tax haven for the very rich.”

Real estate attorney and property owner Leslie Evans agreed. He said residents enjoy several tax blessings — no state income tax, no estate tax and no inheritance tax.

“That has helped convince people from New York and New Jersey, who are normally here for a few months out of a year, that it pays to become a Florida resident,” Evans said.

During their annual review of the second-home market, authors Steven Sears, Crystal Kim, Sandra Ward and Jonathan Laing discovered buyers are fleeing high-tax states to purchase property in states with less onerous tax burdens. Big winners were states without income taxes — Florida, Nevada, Texas and Wyoming.

Jackson Hole, Wyo., topped the list for its accessibility, lack of taxes, outdoor activities and natural beauty. The Hamptons and Pebble Beach plummeted in rankings because of high taxes in New York and California, respectively.

Many high-end real estate markets struggled in 2012, “until state and federal elections in November and Washington’s fiscal-cliff sideshow in December,” the authors note.

“The threat of rising taxes and a mistrust of the stock market together prompted buyers to buy luxury homes,” the article states.

Single-family home sales particularly spiked in December because some residents were worried about proposed changes to the inheritance tax that never happened, Evans said. In addition, he said, a permanent increase in the capital gains tax rate to 20 percent (up from 15 percent) and a 3.8 percent surtax on net investment income affected home sales.

“If you were going to sell a home, it made sense for you to do it last year,” he said.

Buying a home in Palm Beach also is an investment, Evans said.

“If you put your money in the bank, you’re lucky to get 1 percent, but money appreciates in homes,” he said. “It’s not just a home, it’s a commodity in Palm Beach.”

But high-priced condominium sales were the real story for 2012, with the island “increasingly attracting the young and prosperous,” authors said.

Evans listed 330 condo and co-op sales in 2012, an increase of about 100 over the previous year, in his annual Evans Report compilation of residential real estate sales in town.

Evans said he thinks 2013 will be a positive year for real estate as well.

“I think the fact that the cultural scene down here is improving and [Palm Beach International Airport] has expanded flights is helping,” he said. “Weather and finances are positive, what else could you ask for?”


Source: Aleese Kopf, March 8, 2013, Palm Beach Daily News


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