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Comment by wmil | Hacker News Reader

There was a story a while back about sales of NYC apartments over 5 million slowing.

I think this is actually due to Trump capping the state income tax deduction. States with high income tax rates are seeing less real estate speculation.

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Anecdotally, a significant enough amount (not a majority, but enough to move prices) of 5M+ home purchasing is from foreigners looking for a pied a terre in New York. Emerging markets have not been doing well, so there is less of that activity.

IMO this is why a free-for-all relaxation of zoning doesn't work in New York, because a few select global cities (London, Paris, New York, etc.) have global appeal, and therefore market demand is not limited to just locals. Oligarchs aren't exactly looking to set up in the Bay.

Does Nevada have high income tax? Is that why this is happening maybe?

Nevada has no income tax. This is actually why this observation is interesting to me. I thought tax changes were causing the slowdown in my area in Northern CA as well, and figured NV would be getting a bit of a boost, but I guess not.. so maybe it is a real slowdown after all.

A data point for your consideraton: One month ago, I briefly flirted with moving to Las Vegas for tax reasons. I was shocked at the expense (and shabbiness) of high-end housing there. Construction costs were similarly high--I was quoted $450-$500/sqft, on par with NYC. My realtor explained to me that rich Californians were "stampeding" into Nevada and causing some serious dislocations in real estate. She thought the market was eventually going to crater.

Nevada doesn't have a state income tax.

Nevada has zero income tax. Only property and sales tax. The property tax is very low too.

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