In 233 U.S. Cities, Even a Starter Home Costs $1 Million

In hundreds of U.S. cities, buying a first home has become a seven-figure challenge. While the typical starter home nationwide is worth an attainable $192,514, there are 233 cities where a starter home comes with a price tag of $1 million or more.

Five years ago, there were only 85 cities where a typical “starter home” — defined for this analysis as being among those in the lowest third of home values in a given region — was worth at least $1 million. However, that number has slipped from 239 at the start of this year as sellers have so far made a stronger return to the market than buyers, causing home values to soften. With more homes hitting the market, listings lingering longer, and sellers cutting prices at record rates, buyers are starting to regain some negotiating power.

While cities with $1 million starter homes still represent a small piece of American real estate, they are a striking symbol of how the pandemic housing boom reshaped affordability. Many young households are postponing homeownership — the median age of a renter is up to 42 years old — driving demand and prices for single-family rentals to new heights. 

This is no longer just a California phenomenon. To be sure, California still has the most cities with $1 million starter homes by a wide margin (113), but exactly half of U.S. states have at least one such city — including Minnesota and Rhode Island, which joined the list in the past year. After California, New York (32) and New Jersey (20) have the highest totals. 

The New York City metro area, which includes parts of New Jersey and Pennsylvania, leads all metros with 48 cities where a typical starter home costs $1 million or more. The San Francisco metro has the next-highest count at 43, followed by Los Angeles (34), San Jose (16), Miami (8) and Seattle (8).