Is Massachusetts Driving Out Its Wealthiest Residents?

A slow shift in behavior that's harder to see, but just as consequential

Massachusetts has a wealthy resident problem, but not in the way people usually talk about it.

It's not that every millionaire is suddenly packing up and moving to Florida. That's too simple.

The real issue is quieter than that. The people with the easiest ability to leave are starting to ask themselves: why are we still here?

For a long time, Massachusetts could justify being expensive. Great jobs, great schools, great hospitals, beautiful towns, access to Boston.

But now the tradeoff feels different. Taxes are high. Housing is expensive. Traffic is brutal. Building anything new feels impossible. For people with options, staying here is becoming less automatic.

That matters because this is not just about rich people. When wealthy residents leave, change their residency, or start spending more of their life somewhere else, it affects the tax base, local businesses, nonprofits, luxury real estate, and the long-term strength of the state.

As someone who works with buyers and sellers across Greater Boston, this is a real conversation happening behind the scenes.

In this guide, we're going to talk about what's actually happening, what's being exaggerated, and whether Massachusetts is making it harder for its wealthiest residents to stay.

The Real Question We Need to Answer

So let's start with the question we actually need to answer, because it's not "are all rich people leaving Massachusetts?" That's not what's happening.

The better question is: are the wealthiest residents becoming less committed to Massachusetts?

Because here's the thing, some people are still moving here. Some people are still buying luxury homes at the top of the market. Massachusetts still has huge advantages that most states would kill for. This isn't a mass exit overnight, and I want to be clear about that right up front.

What this actually is, is a slow shift in behavior.

What This Slow Shift Looks Like

The real risk is not a moving truck in every wealthy neighborhood. The real risk is wealthy residents quietly reducing their exposure to Massachusetts.

What does that look like in practice? It looks like changing tax residency to Florida or New Hampshire while still keeping a place here. It looks like people being much more intentional about where they spend their time, where they keep their primary home, and whether Massachusetts is still truly their main base. It looks like selling a large primary home and downsizing into something smaller, with less tax and less maintenance. It looks like keeping a Boston pied-à-terre but building your real life somewhere else. It looks like retiring somewhere that's just easier.

None of those show up as a single dramatic headline. But add them up across enough households, and you start to see a pattern.

Why Massachusetts Has Always Been Able to Charge a Premium

Before we get into what's changing, I want to give Massachusetts its due, because this state has never been cheap, and people have always been willing to pay for it.

Why? Because the value was obvious.

The Historic Value Proposition

You've got some of the highest-paying jobs in the country here, biotech, healthcare, finance, tech, education. You've got world-class hospitals: Mass General, Brigham and Women's, Dana-Farber. If you or someone in your family ever gets seriously sick, there is almost nowhere better in the world to be than right here.

You've got the universities, Harvard, MIT, Tufts, BC, BU, which pull in talent, research dollars, and prestige that ripple through the whole regional economy. You've got strong public and private K-12 schools in towns like Newton, Wellesley, Weston, Lexington, and Concord. You've got Boston's economy itself, which has weathered recessions better than a lot of other major cities. You've got historic New England towns, coastal access on the North Shore and South Shore, and property values that have appreciated for decades.

Massachusetts has always been expensive. The difference is that for a long time, the price felt justified.

The Current Situation

That's the baseline we're working from. Nobody's saying this state lost its value overnight. What we're saying is the scale has started to tip.

What Actually Changed?

So what actually changed? Honestly, it's not one thing. It's the pileup.

Start with taxes. The millionaire surtax raised the top income tax rate for high earners, and even with the estate tax threshold now higher than it used to be, Massachusetts still has a much lower estate tax threshold than the federal government. Then there's estate tax planning, which has become a real conversation for older homeowners and business owners in a way it wasn't a decade ago.

Then there's housing costs, which in Greater Boston have outpaced wage growth for years. There's traffic, anyone who's tried to get from the suburbs into Boston during rush hour knows exactly what I mean. There's ongoing frustration with the MBTA and the state's infrastructure more broadly.

There's the housing supply problem, Massachusetts has a well-documented shortage of new housing, and permitting and local opposition at the town level make it genuinely hard to build anything, anywhere, even when there's demand.

And then there's remote work, which didn't create this trend but absolutely accelerated it. If your job doesn't require you to be in a specific zip code anymore, suddenly every other variable, taxes, weather, cost of living, gets a lot more weight in the decision.

Add to that the fact that retirees and successful business owners simply have more choices today than they used to. A sale of a business, an inheritance, a retirement, these are the moments when people reassess everything, including where they live.

One issue probably does not make someone leave. The problem is when all of these issues start stacking on top of each other.

This isn't a political talking point. It's just what happens when enough friction builds up in one place at the same time.

The Tax Conversation: What People Get Right and Wrong

Now let's talk about the part of this conversation everyone wants to jump straight to: taxes.

The Millionaire's Surtax

In 2022, Massachusetts voters approved what's commonly called the millionaire's tax, officially the Fair Share Amendment. It added a 4% surtax on income above a threshold that started at $1 million in 2023 and is indexed for inflation. For 2026, the threshold is $1,107,750. That surtax sits on top of the state's existing 5% income tax, bringing the top rate on income above that threshold to 9%. The revenue is dedicated to education and transportation, and supporters point out it's generated more than $6 billion for the state since it took effect.

That's the part most people know about.

The Estate Tax Piece

Here's the part that gets less attention: the Massachusetts estate tax. The state currently has a $2 million estate tax threshold. That's double the old $1 million threshold, but it's still low compared with the federal estate tax exemption, which sits at $15 million per person. And unlike the federal system, Massachusetts does not let spouses share or transfer an unused exemption, so for older homeowners and business owners with real estate, retirement accounts, and a closely held business, crossing that $2 million line can happen faster than people think.

What the IRS Data Actually Shows

So now let's look at what the data actually shows. According to reporting on the most recent IRS migration data, which is based on year-to-year tax return address changes, Massachusetts saw roughly $4.2 billion in net adjusted gross income leave the state in 2023, the first full year the surtax was in effect. That's an 8% increase from the year before. And interestingly, the number of people who left the state actually went down, what increased was the income attached to the people who did leave.

Taxpayers earning $200,000 or more accounted for about 70% of that net outflow, more than double their share just a few years earlier. It's worth being precise here, that $200,000 bracket is the IRS's own cutoff, not just literal millionaires, so the data captures a broader slice of high earners than the surtax itself targets.

Balancing the Perspective

Now, here's where I have to be fair to both sides of this. MassBudget and other groups point out that Massachusetts has lost income to outmigration for years, long before the surtax existed, and that the broader data doesn't prove the population is in crisis, or that taxes are the main driver. They're not wrong about that either. Total income lost was actually higher in 2021, before the surtax even existed, than it was in 2023.

So what do I think? I think taxes may not be the only reason people leave, but they can be the thing that makes people finally ask the question.

If someone loves their life here, taxes alone may not move them. But if they're already frustrated with the cost, the traffic, the housing, and the politics, taxes can become the final straw.

How This Shows Up in Real Estate

Here's the thing about all of this, you're not going to see it clearly in a statewide headline. You're going to see it in buyer and seller behavior, in the conversations that happen at the kitchen table before a listing ever goes live.

The Luxury Market Today

Some luxury buyers are still very active. There's still real demand at the high end, and some homes are still moving quickly and at strong prices. I'm not telling you the luxury market is dead, it's not.

But some high-end homes are sitting longer than they used to, especially if they feel overpriced or come with a lot of maintenance and upkeep. Affluent buyers are being more selective than they were a few years ago. They're asking harder questions about taxes, about commute, about what they're actually getting for the price.

What's Still Performing Well

Towns with strong schools, easy commutes, and real lifestyle appeal, the Newtons, the Wellesleys, the Lexingtons of the world, are still performing well. But large, older homes with high property taxes, deferred maintenance, or an awkward location can struggle to move, even at a price that would have flown off the market five years ago.

The Real Shift

The luxury market is not dead. It is just less forgiving.

Wealthy buyers still have money. What they have less of is patience for a bad value proposition.

That's the real shift sellers at the high end need to understand. You cannot assume demand is unlimited just because the buyer has the means.

Who Is Most Likely to Leave or Pull Back?

This isn't every wealthy person in Massachusetts. It's specific groups, and if you've spent any time in this market, you start to recognize the pattern.

Empty nesters, once the kids are out of the house and the size of the home no longer matches the life they're living.

Retirees, who no longer need to be near a specific job or commute.

Business owners, especially right after a sale, when a big chunk of their net worth suddenly becomes liquid and portable.

Executives with remote flexibility, who realized during the pandemic that they didn't actually need to live within an hour of the office.

People who already own a second home somewhere warmer or cheaper.

Families who no longer need to be tied to a specific school system.

And people who own genuinely expensive homes here but feel like the quality of life, the traffic, the taxes, the upkeep, just isn't matching the price tag anymore.

The Pattern

The people most likely to leave are not always the loudest people complaining. They are the people who can make a quiet decision and actually act on it.

That's what makes this trend so hard to see from the outside. The people most capable of leaving are usually the least likely to make a public show out of it.

Why Massachusetts Should Care

Now, you might be thinking, why should I care if a handful of wealthy people leave Massachusetts? Fair question.

You do not have to feel bad for wealthy people to understand that losing too many of them can still create real consequences.

The Tax Base Impact

Start with the tax base. A relatively small number of high earners can account for an outsized share of state income tax revenue, which means even modest shifts at the top can create real volatility for the state budget.

Beyond Direct Taxes

Then there's philanthropy, hospitals, universities, and nonprofits across this state rely heavily on high-net-worth donors.

Then there are the local businesses that serve this population directly: restaurants, contractors, designers, attorneys, accountants, wealth managers.

There's the luxury housing market itself, which is a meaningful piece of the broader real estate economy.

There's civic leadership, a lot of local boards, hospital trustees, and university trustees come disproportionately from this group.

And there's the bigger long-term question: does the next generation of wealth build its life here, or somewhere else?

The Long-Term Risk

A state can be wealthy and still make itself less competitive over time.

That's the risk nobody wants to say out loud, because it sounds harsh. But it's true.

What's Being Exaggerated

Now let's pump the brakes, because I don't want you walking away thinking Massachusetts is falling apart. It's not.

Massachusetts is not collapsing. Boston is not becoming irrelevant. Wealthy people are still buying homes here every single week. The state's population actually grew last year, even with everything we've talked about, in the most recent Census estimates, international migration and natural increase helped offset the people moving to other states. Job growth in key sectors still supports the state. Plenty of people still want access to Boston, and the best suburbs and neighborhoods are still genuinely desirable places to live.

The Real Nuance

The mistake is acting like Massachusetts is either doomed or completely fine. The truth is somewhere in the middle.

Massachusetts is still incredibly desirable. That does not mean it can take wealthy residents for granted.

That's the nuance that gets lost in a lot of the coverage on this topic, and it's the nuance we should actually be paying attention to.

The Core Issue

So, is Massachusetts driving out its wealthiest residents?

Not all of them.

Not overnight.

But Massachusetts is making it easier for wealthy residents to question whether staying here is still worth it.

That is the part we should be paying attention to.

Because when the people with the most options start looking around, the state has to ask itself a harder question:

Are we still offering enough value to justify the cost?

What This Means for the Housing Market

For people buying or selling in Greater Boston, especially at higher price points, this dynamic is already showing up in subtle but important ways.

For Sellers

If you're selling a luxury home, the old playbook of "this is Newton, it will sell itself" no longer applies. You need to think hard about:

Are your taxes competitive compared with neighboring towns?

Is your home move-in ready or will the buyer need to invest heavily?

What is the actual quality of daily life, not just the address?

Does the value justify the price, especially when compared with less taxed locations?

For Buyers

If you're buying in Massachusetts, especially at the high end, the broader question is becoming more relevant:

Is there a purpose to being here that justifies the premium?

Is it the schools, the jobs, the culture, the community?

Or are you simply overpaying for address while other variables (taxes, traffic, housing costs) are making daily life harder, not better?

For Long-Term Residents

And if you're already here, considering whether to stay, the question is becoming: at what point does the accumulation of friction, taxation, housing costs, and lifestyle considerations outweigh the genuine advantages Massachusetts still offers?

The Real Conversation

The conversation happening in real estate right now is not "Massachusetts is dead." It's "Massachusetts feels like a choice now, not a default."

And that choice is getting harder to justify for some people.

That doesn't mean the state should panic. It means the state should pay attention to what's actually driving these quiet decisions, and whether the value proposition is still working for the people it most needs to keep.

Because the difference between "we're still thriving" and "we're slowly losing momentum" can be measured in years before anyone notices it's happened.

Massachusetts is still one of the most desirable places in America. The question is whether it stays that way, or whether it becomes the place people used to want to live.

The answer depends on decisions being made right now.