California Has More Billionaires Than Any Other State—Now Some Are Considering Fleeing as a Wealth Tax Is Proposed

Billionaires including tech venture capitalist Peter Thiel and Google co-founder Larry Page are considering leaving California by the end of the year due to a proposed "wealth tax" that would effectively levy a one-time 5% tax on their assets, according to a new report.

Thiel, who has a reported net worth of around $27.5 billion, owns a home in the Hollywood Hills and runs his investment firm from Los Angeles, but is reportedly weighing plans to open an out-of-state office and shift more of his time beyond California, The New York Times reports.

Page, a longtime Palo Alto resident with a reported net worth of $258 billion, is said to be considering a move out of state before year-end. Earlier this month, state records show that three limited liability companies linked to Page had filed incorporation documents in Florida.

What the proposed wealth tax is

The potential California ballot measure from the health care union Service Employees International Union-United Healthcare Workers West calls for California residents worth more than $1 billion to be taxed the equivalent of 5% of their assets.

This could generate about $100 billion in revenue for the state.

At least 90% of the money would be spent on health care services for the public, and the rest would be spent on administration of the wealth tax, education, and food assistance. 

Whether the tax would pass remains uncertain, since a similar 1.5% tax on billionaires failed in the legislature last year, with Gov. Gavin Newsom, a Democrat, opposing the measure.

But if this measure gains enough signatures to reach the state ballot in November and wins approval, it will retroactively apply to anyone who lived in California as of Jan. 1, 2026.

The billionaires would have five years to pay the one-time tax—and the only way they could escape the levy is if they leave the state before New Year’s Eve 2025. 

California is a hotbed of billionaires

California is home to more billionaires than any other state, with roughly 200 residents holding fortunes exceeding $1 billion.

Among them are four of the world’s wealthiest figures: Page and Sergey Brin of Alphabet, Mark Zuckerberg of Meta, and Jensen Huang of Nvidia, according to the Bloomberg Billionaires index. 

Their combined net worth is estimated at $840 billion. At a 5% tax rate, this small group alone could yield $40 billion in revenue—provided they don’t relocate.

CPA and wealth-preservation attorney Chad D. Cummings of Cummings & Cummings Law in Florida and Texas, tells Realtor.com® he has already assisted "dozens of high-net-worth clients relocate" to states like Florida and Texas.

"They levy zero personal income tax and, in many cases, zero business income tax; provide extremely strong homestead exemptions that shield primary homes from most creditors; and maintain predictable asset protection laws that California lacks," he says.

Proponents and critics of the proposed wealth tax

While critics oppose the measure, some believe that taxing the wealthiest is a common-sense solution.

"California is facing a manufactured crisis," former U.S. Secretary of Labor Robert Reich said in a press release. "These federal cuts didn’t happen by accident—they were designed to shield billionaires from contributing while pushing the consequences onto patients and workers. A time-limited emergency tax on the ultra-wealthy is a practical way to keep the health care system functioning."

But other critics argue that increasing taxes on the wealthy would do more harm than good to California’s economy.

Billionaire investor Bill Ackman, who lives in New York, wrote on X, "California is on a path to self-destruction. Hollywood is already toast and now the most productive entrepreneurs will leave taking their tax revenues and job creation elsewhere."

Real estate holdings of California billionaires

Not surprisingly, California’s billionaires hold vast portfolios of ultra-expensive real estate.

Zuckerberg, with a net worth of $260 billion—ranking him as the world’s third-richest individual—has acquired 11 properties in and around Palo Alto over the last decade. He is now combining them into a $110 million compound that is under construction.

Brin, who has a net worth of $212 billion, reportedly owns a $35 million Malibu, CA, estate that he purchased in 2022.

Huang, the world’s ninth-richest person with $162 billion, has reportedly spent about $55 million assembling a notable real estate portfolio that Mansion Global reports includes a $38 million San Francisco Gold Coast mansion and a $6.9 million home in Los Altos Hills near Nvidia's headquarters.

With this wealth tax proposal looming, attention is turning to what it could mean for the state’s ultra-luxury housing market.

"Other ultra-luxury enclaves outside of California could see increased demand if buyers choose to eschew the Golden State. Places like Fisher Island in Miami might get more attention from wealthy buyers and see already-sky-high home prices grow further," says Realtor.com senior economist Joel Berner.

In fact, Miami real estate agent Brett Harris of Bespoke Real Estate told The New York Times that he had been contacted recently by five California billionaires who planned to move to Florida so they could offset their risk of exposure to the billionaire tax.

Palm Beach real estate broker Jeff Lichtenstein, CEO of Echo Fine Properties, tells Realtor.com, "If the wealth tax measure passes, this will be a very good thing for luxury Florida real estate. As a Florida [agent] and broker, I’m salivating!"

More potential impacts on the California real estate market

The proposed wealth tax could also impact the demand for ultra-luxury homes in California, according to Berner.

"This could lead to price softening and a slowing pace of sales on the top end of the market," he says. "It's possible that we could see more availability of homes for sale in ultra-wealthy enclaves in the state as sellers struggle to match with buyers who may be a bit reluctant to make a purchase. Ultra-luxury homes could spend longer on the market and build up in higher numbers than we have seen previously."

The uncertainty surrounding the wealth tax and whether it will be implemented will likely have the strongest effect on the housing market itself, according to Berner.

"Whenever buyers feel unsure of their financial footing, they are less likely to make a major purchase," he explains. "We're currently seeing this at the median of the market where affordability constraints combined with fears about financial futures are preventing average buyers from pulling the trigger, so it's not too much of a stretch to say that a large one-time tax burden could have a similar effect on the wealthy."

Berner says we can expect sales and construction starts at the top end of the price spectrum in California to slow as buyers and builders get a feel for what's actually going to happen.

"If there is indeed a pullback in construction activity for high-end housing in California, it could be the case that builders focus more on delivering mid-level inventory to the market, which is exactly what the state could use more of," explains Berner. "Builders have to make money one way or another, so we could see an added emphasis on construction activity closer to the price median."

Since affordable inventory is hard to come by in California, "this could actually become a net positive," Berner adds.

Some billionaires predicted to stay put, despite the proposed tax

Sam Fitz-Simon, a real estate agent with Compass in Danville, CA, says, "I don’t see the proposed wealth tax triggering a mass exodus from California. Many people stay in California because of business ties, family, lifestyle, and long-term roots, even when taxes are a concern."

Berner agrees with that assessment.

"The state has always had high taxes and billionaires choose to live there anyway for other reasons, such as the availability of the kind of ultra-luxury homes they're interested in," he says.

"More than likely, some creative accounting will be used to mitigate the tax's impact and the billionaires will stay in the California mansions that they've grown to love."