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The United States now has a new high of 550 “million-dollar” cities, where the typical home is worth at least $1 million, a study from Zillow shows.
During the same period last year, there were only 491 million-dollar cities, as home prices faltered amidst rising mortgage rates and economic uncertainty.
Today, tight inventory and competition for the most attractive homes on the market have driven home values higher and higher.
This spring buying season, however, new listings are increasingly coming to market as homeowners free themselves of “rate lock.” If mortgage rates continue to drop later in the year, more buyers entering the market along with increased demand could push prices even higher.
As U.S. home values fell in late 2022, million-dollar cities were some of the greatest impacted, but they have largely seen similar increases in value in the last year as other U.S. cities. The typical U.S. home has increased in value by 4.2 percent in the last year, while the median annual home value growth in million-dollar cities is 4.6 percent.
California has nearly half of the nation’s million-dollar cities, with 210 million-dollar cities in total. The state gained 12 million-dollar cities in the last year, just behind New Jersey’s addition of 14 new million-dollar cities, to bring the state’s total of million-dollar cities up to 66.
Just three states saw a net loss in million-dollar cities in the last year: Florida, Texas and Delaware. Siesta Key, Santa Rosa Beach and Sanibel dropped off Florida’s million-dollar list as the Village of Palmetto Bay (near Miami) was added. In Texas, Sunset Valley and Volente, both near Austin, saw the typical home value drop below $1 million, as Bellaire (outside Houston) saw values rise above $1 million. Delaware’s Dewey Beach also fell off the million-dollar city list.
By metro area, New York City takes the cake with the most million-dollar cities out of all other metros. The metro area, which encompasses parts of New Jersey and Pennsylvania, has 106 million-dollar cities, which is 24 more than last year. In second place is the San Francisco metro area with 69 million-dollar cities, followed by Los Angeles’ 63 million-dollar cities.
Million-dollar cities are concentrated in coastal states, where the 11 metros with the most million-dollar cities are located. Denver and Dallas, with seven and eight million-dollar cities, respectively, are the top metros that aren’t located in coastal states.
Los Angeles saw significant gains in million-dollar cities in the last year, with the addition of seven new cities. Boston added four new million-dollar cities as San Diego, Chicago and San Luis Obispo each added three.
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