The frenzy of activity in the U.S. housing market has gone on for two years. And based on January data, this will likely not end any time soon. The median home price in America has been climbing and now sits at a record $350,000. The figure could move closer to $400,000 by year’s end.
Partly driving the median home price higher is the booming high-end market. The hottest luxury housing market in America is Kahului, Hawaii. (And this is the American city with the most million dollar housing markets.)
Among the reasons for the overall jump in housing prices is the COVID-19 pandemic, which triggered a shuttering of business offices and allowed many workers to be more mobile. Some people have been told they will not need to return to do their offices. Low mortgage rates (which have started to rise) have also encouraged significant housing activity.
Another trigger for the home prices jump in some markets is the move of people from the most expensive markets, particularly those on the coasts. While home prices have reached two to three times the national median in New York and San Francisco, prices in smaller inland cities run well below those levels, and the overall cost of living in those inland cities is also often considerably lower.
But while some people move away from expensive markets, wealthier homebuyers actually are looking for a home in some of the more affluent and beautiful places. Some of these rich enclaves have become vacation destinations, while others are suburbs of large cities. Some are large cities that have had large influxes of populations, in particular cities where buyers are well educated and have high incomes. (This city has the most expensive houses in America.)
Realtor.com just released its Living the Dream: Here Are the Hottest Luxury Real Estate Markets in America Right Now report. In the report, the real estate data site considered just the most expensive 1% of homes in large metro areas. Nationwide, the top 1% of homes for sale had a median listing price of $5.5 million in January. The most expensive 1% of homes in Kahului have a median value of $23.9 million.
Frank Nothaft, chief economist at CoreLogic, pointed out that “Those who have been very successful, who kept their jobs, and [who] saw the stock market go through the roof cashed out their gains to use that as their down payments to buy a second home.”
To find the hottest luxury home markets in America, 24/7 Wall St. reviewed Relator.com’s report. Here are the top 10 markets and the median value of the top 1% of homes there:
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