LuxuryBlurb
Posts Tagged ‘wealthy’
Tuesday, February 28th, 2012
Posted by Leonard Steinberg on February 28th, 2012
The rich are under seige! Across the globe, countries are turning to the rich to resolve their budget crises. Now, the Socialist favourite in France’s presidential election, Francois Hollande, has said top earners should pay 75% of their income in tax: “above 1m euros [£847,000; $1.3m], the tax rate should be 75% because it’s not possible to have that level of income,” he said. If elected, he would undo tax breaks enacted by Nicolas Sarkozy.
The gap between the Socialist candidate and Mr Sarkozy has narrowed. The two are tipped to reach the run-off on 6 May, after eliminating other rivals on 22 April.
Taxation for the rich has become a hot campaign issue across the globe, with tax advisers in neighbouring Switzerland saying that higher taxes for the wealthy in France could spark an exodus. Will these French buyers come to the USA, specifically New York?
Which country will address the tax issue of the wealthy in a smart, calculated, calm manner? It appears the USA may not be that smart on this issue when politicians only talk about raising or lowering rates without addressing the huge disparity within the wealthy when it comes to loopholes and tax breaks. A significantly lowered tax rate without loopholes would lower taxes for the majority of the wealthy’s taxes but stop many of the billionaires and their companies from paying significantly lower taxes. Maybe a campaign that identified it is very UN-AMERICAN to screw the system out of paying your fair share of taxes would be the answer, as long as the tax rates were not designed to discourage wealth and worse, encourage exodus, certainly the predicted outcome of 75% taxes in France.
Many of France’s richest celebrities already live abroad.
Tuesday, October 12th, 2010
 2010 Bonus pay on Wall Street is on pace to break a record high for a second consecutive year, according to a study conducted by The Wall Street Journal……so brace yourself for a real estate boost this coming Winter in New York.
About three dozen of the top publicly held securities and investment-services firms—which include banks, investment banks, hedge funds, money-management firms and securities exchanges—are set to pay $144 billion in compensation and benefits this year, a 4% increase from the $139 billion paid out in 2009, according to the survey. Compensation was expected to rise at 26 of the 35 firms. We suspect many of these bonuses will not be cash, but even if they are paid out over extended periods, when the wealthy feel wealthier they spend. This could be great for New York’s economy.
“Huge bonuses usually fuel a very active real estate market in New York,” says Leonard Steinberg, managing director of Prudential Douglas Elliman and publisher of LUXURYLETTER. “I would suggest to anyone wanting to buy an apartment in Manhattan at “2009 PRICES”, to start looking and deciding right now: super-low interest rates, reduced inventory of quality apartments, minimal building, combined with this level of money infusion can lead to only one thing…..rising prices. Already we have seen an uptick in activity: the wealthy are always a few steps ahead of the game. Brace yourself.”
While many bonus recipients already own fabulous apartments and have no need to buy a new one, the confidence boosted by bonuses usually adds momentum to the real estate market. It is often the first time bonus recipient that buys their first apartment, or the ‘rising star’ recipient whose bonus has increased dramatically that decides to upgrade. This fuels transactions.
The benefit to the City and State is two-fold: firstly, substantial taxes are collected on these bonuses……taxes on the bonuses themselves, and then sales taxes on the bonus money used for spending. Every time a $ 1million property sells, about $ 28,000.oo is paid in transfer taxes and mansion taxes alone, not to mention mortgage taxes and sales tax on products needed for moving: movers, new furniture, electronics, etc. This demand also fuels new jobs, that takes welfare and state beneficiaries off the dole.
Yes, we can all be green with envy at these often ridiculous sums of money sometimes paid to people who probably don’t deserve that much money, but we are all the beneficiaries. And to those outside of New York complaining about Wall Street: remember that for every dollar New Yorker’s pay to the Federal government, only about 85cents comes back to the state: so other states are the beneficiary. New York pays almost 12% of all federal taxes collected. Also be reminded that 41% of New Yorkers pay no Federal taxes at all.
Friday, July 23rd, 2010
 According to a recent post in FORBES, America’s richest are spending less cash, and they are being more choosy about the products they actually buy. The Survey of Affluence and Wealth in America 2010 — a creation of American Express Publishing and the Harrison Group — polled about 2,400 people from the richest 10% of U.S. households.
Below the top 10 consumer trends of the ultra-wealthy:
1. The wealthy are spending less and shopping smarter: The rich are still willing to buy high-end products, but relish sales and quality, not namesake or status.
2. They may not be optimistic, but they’re happy. About 91% of those surveyed thought the U.S. was still in the middle of a recession, and 60% felt it would take one year or more for a full recovery. But 71% were happy in their personal relationships. Contrast that to the 43% of the general population who reported being happy.
3. Family is important. About 83% of those surveyed said they eat dinner with their family at least four times a week, up from 16% five years ago when they survey began.
4. Cutting costs is stylish now. You might see an increase of millionaires shopping at Wal-Mart (NYSE: WMT – News). More than 77% of respondents defined themselves as resourceful and more self-reliant. Online deals and coupons are big, and the rich were more likely to wait for items to go on sale than in the past. Purchasing generic brands and buying in bulk were also popular.
5. They are less worried about their jobs. Confidence in job security increased 20% from last year.
6. More online shopping, less real people. Good news for Amazon (NASDAQ: AMZN – News), EBay (NASDAQ: EBAY – News) and Google (NASDAQ: GOOG – News): the affluent prefer to research and purchase products online, and far fewer relied on salespeople.
7. They are better communicators. About 64% said that they now talk to their kids and spouse about money. Divorce is also down nationwide.
8. They feel less guilty about being rich. In 2009, many of the wealthy surveyed felt guilty about buying luxury goods or discussing their worth. Now, they’re trending toward less guilt and a greater desire for people to know they are affluent.
9. They’re increasing brand loyalty. There was a 6 % increase in consumers who said “I have a few brands that I like,” and a 7 % increase in those who said “The brands I wear say a lot about me.”
10. Print might make a comeback, maybe. About 69% answered that they pay more attention to print ads than those online. Only 8% said they use Facebook to make a purchasing decision, though more than 40 % had Facebook accounts.
Monday, March 1st, 2010
 Billionaire Warren Buffett said the U.S. residential real estate slump will end by about 2011, predicting that’s how long it will take demand for homes to catch up with the supply.
“Within a year or so, residential housing problems should largely be behind us,” Buffett wrote Feb. 27 in his annual letter to shareholders of his Berkshire Hathaway Inc. “Prices will remain far below ‘bubble’ levels, of course, but for every seller or lender hurt by this there will be a buyer who benefits.”
We see this trend happening already in Manhattan whereby the best properties at the ’2009 prices’ are slowly but surely dissapearing, leaving very few good options behind. With unemployment of the wealthy around 3-4%, and the Manhattan market catering to predominantly wealthy people, the absorption rate of the best could happen quicker here than other parts of the country.
What do you think?
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