More Than 500 US Cities Now Have Average Home Prices Above $1 Million: Report

At least 550 cities across the United States are now being dubbed as "million-dollar" cities, which means the typical home value is worth $1 million or more, according to new research.

The number is the highest ever recorded in the US, per the real-estate-listings website Zillow, which conducted the study. In comparison, only 491 cities had average home values of $1 million in 2023.

The report also found that median home prices in million-dollar cities have increased 4.6% year-over-year whereas the national median home value only increased by 4.2% in the same period.

Rising home prices have largely been fueled by mortgage rates, which began soaring after the Federal Reserve hiked interest rates to tame inflation. Mortgage rates peaked at 8% in October last year before dropping to 6.79% in the week ending March 28, 2024, data from Freddie Mac showed.

In addition, the lack of supply in the housing market has also pushed home values higher. The S&P CoreLogic Case-Shiller US National Home Price NSA Index noted that home prices rose 6.0% year-over-year in January 2024.

"The housing market is tight with few homes available, and competition is still high for homes. That competitive pressure is pushing home values higher across the US," Anushna Prakash, an economic analyst at Zillow, said.

States With the Most Number of Million-Dollar Cities

California topped the list, with the state being home to 210 million-dollar cities. That is up from 198 recorded a year ago. California is the only state with more than 100 million-dollar cities.

Second on the list is New York, with 66 million-dollar cities as of February 2024, when the study was conducted. In comparison, New York only had 54 million-dollar cities last year.

New Jersey followed closely, with 49 million-dollar cities this year. The state gained the most number of million-dollar cities over the past year, gaining 14.

Delaware, Florida, and Texas were the only states that lost million-dollar cities in the past year, with Florida losing three-Sanibel, Santa Rosa Beach, and Siesta Key.

Full List of Million-Dollar Cities by State