Home prices in America have soared over the past two years. The carefully followed S&P CoreLogic Case-Shiller Index showed that home prices rose 20.6% nationwide in March, the fastest pace since the index was created. In some cities, the rise was closer to 30%.
What has happened to drive these increases? Among other things, mortgage rates that were below 3% for a 30-fixed rate loan. Those days are over though, as mortgage rates now have surged to above 5%.
Americans became more mobile because the pandemic offered more opportunity to work from home. Many left expensive coastal cities for less expensive cities inland. Real estate prices in cities like New York and San Francisco can be more than twice the national average.
To determine the city with the most expensive homes, 24/7 Wall St. reviewed data from Realtor.com’s Monthly Housing Trends Report. In the report, the 50 largest metropolitan areas in the United States were ranked based on the median home listing price in May 2022.
Home prices have continued to increase nationwide, even as demand has cooled in the wake of higher prices and mortgage rates. Demand for homes is still high coming off the heels of the COVID-19 pandemic, but such high list prices may be dissuading some potential buyers from entering the market, while higher interest rates are pushing some buyers out of the market.
Many of the places with the most expensive homes are also among the largest metro areas in the country. These population centers offer access to high-paying jobs, good schools and entertainment and dining options, making them attractive places to live and driving up home costs.
The metropolitan area with the most expensive homes is San Jose-Sunnyvale-Santa Clara, California. Here are the details:
- Median list price, May 2022: $1,494,000
- Annual increase in median list price: +15.1% (22nd highest)
- Median days on market: 17 (eighth fewest)
- Population: 1,985,926
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