The number of cities with 'million-dollar' starter homes has
nearly tripled since 2019
- The number of cities where a starter home is worth $1 million or more has grown from 84 five years
ago to 237 today.
- Nearly half of these cities with "million-dollar" starter homes
are in California.
- The typical starter home nationwide is worth less than
$200,000.
SEATTLE, July 25,
2024 /PRNewswire/ -- A million-dollar price tag no
longer means lavish and luxurious living. In more than 200 U.S.
cities, buyers will find a price tag of $1
million or more on the typical starter home, a new Zillow®
analysis finds.
The typical "starter home" — defined for this analysis as being
among those in the lowest third of home values in a given region —
is worth at least $1 million in 237
cities, the highest number of cities ever. Five years ago, there
were only 84 such cities.
Nationwide, the typical starter home is worth $196,611, which is comfortably
affordable for a median-income household. But a housing
shortage that worsened over the pandemic helped drive the cost of
all homes to new heights. Starter home values have grown 54.1% over
the past five years, even more than the 49.1% increase for the
typical U.S. home in the same time frame. That has delayed the
first home purchase for many. The median age of a first-time home
buyer was 35 last year, a year older than in 2019.
"Home buyers are battling affordability and availability today.
So much so that $1 million is the
norm for a starter home in hundreds of cities," said Orphe
Divounguy, a senior economist at Zillow. "However, it's looking
more and more like there will be some good news ahead for
first-time buyers. More homes are for sale, price cuts are on the
rise, and buyers have a few more days to weigh their options as
homes sit on the market."
Exactly half of all states have at least one city with a typical
starter home worth $1 million or
more. There are 117 such cities in California, well ahead of New York (31) and New Jersey (21), which have the second- and
third-highest numbers. Florida and
Massachusetts round out the top
five with 11 each.
Among metropolitan areas, the New York
City metro, which includes parts of New Jersey and Pennsylvania, has the most cities with
million-dollar starter homes at 48. The San Francisco metro has the next highest count
at 44, followed by Los Angeles
(35), San Jose (15), and
Miami and Seattle, each with eight. Irvine, with a population of more than
300,000, is the biggest city with $1
million starter homes.
Markets with the most-restrictive building regulations tend to
have more cities with $1 million
starter homes. They are also markets with lower homeownership
rates.
First-time buyers shopping for a $1
million home, or perhaps something closer to average, can
find tools to help on Zillow. Zillow Home Loans' new BuyAbility℠
tool will give buyers a personalized, real-time estimate of the
home price and monthly payment that fit within their budget, and
then provide insight into the likelihood of qualifying for a loan.
Zillow can also help buyers find and connect with an expert loan
officer from Zillow Home Loans as well as a real estate agent to
help guide them through the process.
Zillow also has rental listings for single-family homes,
apartments and even individual rooms for those who are not yet
ready to jump into homeownership.
State
|
Cities with
Million-Dollar
Starter Homes (June 2024)
|
Cities with
Million-Dollar
Starter Homes (June 2023)
|
Cities with
Million-Dollar
Starter Homes (June 2019)
|
California
|
117
|
98
|
53
|
New York
|
31
|
26
|
13
|
New Jersey
|
21
|
15
|
2
|
Florida
|
11
|
10
|
4
|
Massachusetts
|
11
|
9
|
0
|
Washington
|
8
|
8
|
5
|
Texas
|
7
|
6
|
1
|
Hawaii
|
5
|
4
|
1
|
Connecticut
|
4
|
2
|
0
|
Colorado
|
3
|
3
|
1
|
Wyoming
|
3
|
1
|
0
|
Maryland
|
2
|
2
|
1
|
South
Carolina
|
2
|
2
|
1
|
Arizona
|
1
|
1
|
1
|
Georgia
|
1
|
1
|
1
|
Kansas
|
1
|
1
|
0
|
Michigan
|
1
|
1
|
0
|
Minnesota
|
1
|
1
|
0
|
Missouri
|
1
|
1
|
0
|
Nevada
|
1
|
1
|
0
|
New
Hampshire
|
1
|
1
|
0
|
Virginia
|
1
|
1
|
0
|
Illinois
|
1
|
0
|
0
|
Rhode Island
|
1
|
0
|
0
|
Utah
|
1
|
0
|
0
|
About Zillow Group
Zillow Group, Inc.
(Nasdaq: Z and ZG) is
reimagining real estate to make home a reality for more and
more people. As the most visited real estate website in
the United States, Zillow
and its affiliates help people find and get the home they
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and agents, and easier buying, selling, financing and renting
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#10287 (www.nmlsconsumeraccess.org). © 2024 MFTB Holdco, Inc., a
Zillow affiliate.
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