Residential real estate prices have risen at an astonishing pace. Data from the first part of this year supports the forecast that 2022 could be another year of sharp home price jumps. One of the byproducts of this is that the median value of a home in 2021 was $350,000, up almost 15% from 2020.
Prices increases have been driven by several factors. One is low mortgage rates, which have started to disappear. Another is a migration from America’s expensive coastal cities, such as New York and San Francisco, to less expensive cities and towns inland. Ironically, the demand for homes in the smaller places has caused home prices there to rise by mid-tier double-digit percentages. However, home prices in places like San Francisco have stayed at two to three times the national number.
Another reason for the migration is that millions of Americans can work from home due to the COVID-19 pandemic. Some companies have said that the option for their workers is permanent.
One of the byproducts of home price increases is a very large increase in the number of places where the median home value is $1 million or more. A new Zillow report titled 146 New U.S. Cities Gained Million-Dollar Status in 2021, the Most Ever in a Single Year says that “A record 146 new U.S. cities became ‘million-dollar cities’ in 2021, the highest number of new entrants in a single year, bringing the total to 481 cities nationwide in which the typical home value is at least $1 million.”
In the study, a city is measured as part of a larger metro area. So, in Los Angeles, for example, there are 57 million-dollar cities.
Two metros are tied for most million-dollar cities. Both New York and San Francisco have 76. Based on a large number of expensive homes in the city centers and expensive towns close by, this should not come as any surprise.
These are the 10 metros with the most million-dollar cities:
- San Francisco (76)
- New York (76)
- Los Angeles (57)
- San Jose (22)
- Boston (18)
- Seattle (16)
- Miami (14)
- Washington (11)
- Santa Rosa (9)
- Santa Maria-Santa Barbara (9)
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