The United States has a record number of “million-dollar cities,” where the median home price now exceeds six figures, new data shows.
In total, 550 U.S. cities have a median property price of $1 million or more, 59 more than this time last year.
Data from real estate portal Zillow highlights just how hot the US real estate scene remains after years of steady growth.
California alone has 210 “million-dollar cities,” the most of any U.S. state and an increase of 12 from last year.
They were followed by New York, New Jersey and Florida, which have 66, 49 and 32 respectively.
California alone has 210 “million-dollar cities,” the most of any U.S. state and an increase of 12 from last year. Pictured: A home in San Francisco for sale for $1.49 million
In total, 550 American cities have an average real estate price of $1 million or more. Pictured: A home in San Francisco for sale for $1.49 million
Luxury real estate growth has greatly outpaced the broader housing market, Zillow research shows.
While the value of typical U.S. homes has grown 4.2 percent compared to last year, those in “million dollar cities” had seen an average year-over-year increase of 4.6 percent.
New Jersey has seen the largest increase in cities where home values exceed $1 million. He added 14 to his state in the last year.
Meanwhile, New York, San Francisco, Los Angeles and Boston were the four metropolitan areas with the most “millionaire cities.”
It comes as the so-called “frozen” U.S. housing market shows signs of thawing, as the number of new listings advertised on Zillow increased 20 percent between January and February.
Skyrocketing mortgages have created a “lock-in effect” as homeowners are reluctant to negotiate the cheap 30-year fixed deals they got before rates started rising.
Data from government-backed lender Freddie Mac shows the average rate on a 30-year fixed mortgage is now 6.79 percent.
This is more than double what they were three years ago, when they were around 3.17 percent.
New York, San Francisco, Los Angeles and Boston were the four metropolitan areas with the most “millionaire cities.” Pictured: A $1 million home currently for sale on Zillow in Boston, MA
A house in Los Angeles for sale for $1.49 million on Zillow
The New York metropolitan area had the largest number of “millionaire cities.” Pictured: A $1.5 million apartment for sale in Manhattan’s Lenox Hill
It means that a buyer who purchases a $400,000 property today faces monthly payments of $2,474. This analysis assumes a 5 percent down payment.
However, if they had purchased in March 2021, this figure would be only $1,637, a difference of $800 per month.
However, a recent report from Zillow suggested that real estate activity was starting to pick up again.
Homes that sold in February spent an average of 17 days on the market, slower than during the home-buying frenzy of 2021 and 2022, but still much faster than before the pandemic.
Experts are divided on where the housing market is headed now after it has remained surprisingly resilient.
Last week, Shark Tank star Barbara Corcoran predicted that even the smallest drop in mortgage rates would cause property values to skyrocket.
He told Fox Business: ”If rates go down, just another percentage point, prices will skyrocket.
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‘Everyone will go out and buy. There are probably 10 buyers on the sidelines (for every house on the market) waiting for interest rates to go down,” he continued. “So everyone is going to charge the market.”
By contrast, analyst Meredith Whitney recently told DailyMail.com that prices would soon fall as more and more Baby Boomers begin to downsize and free up inventory.
Whitney, who earned the nickname “Oracle of Wall Street” after accurately predicting the 2008 financial crisis, said: “About 90 percent of the housing stock is owned by people over 40, while 74 percent is from people over 50 years of age.
‘It makes logical sense that many of these owners will begin to downsize in the next decade. There are almost 35 million homes; That’s a huge number to get through the system.
“My advice to owners is: if you want to sell, you better do it as soon as possible.”