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While the typical value of a home in the United States is approximately $263,000, the number of "million-dollar cities" saw a sharp increase during 2020. A report from Zillow reported that there was an additional 45 more U.S. cities with a typical home value of at least $1 million than 2019. This marks the largest increase in million-dollar cities in at least a decade, according to Zillow.
There are now a total of 312 million-dollar cities, a 104 increase from just five years ago. The most recent increase occurred during the COVID-19 pandemic, where home values appreciated by close to 7.5% annually.
According to the report, 70% of million-dollar cities are concentrated within nine coastal metro areas. Of those cities, 61 are in the San Francisco metro area, 51 are clustered around New York City and 39 are in the Los Angeles area. The metro areas of San Jose (20 cities), Boston (11), Miami-Fort Lauderdale (11), Seattle (9) and Washington, D.C., (8) also have multiple cities where the typical home price exceeds $1 million.
"In 2020 home values soared nationwide because of incredible demand across all price tiers, which we expect to continue well into 2021," says Zillow senior economist Chris Glynn. "Despite the label, there are homes available in these communities for less than $1 million, but buyers must be realistic about their wish list and act quickly in the current market, especially since homes are selling in a matter of days in many places. For sellers, it is possible to capitalize on the recent growth in these markets and relocate to far less-expensive markets – particularly with an increase in remote work offering flexibility in the job market."
"An increased demand in places like Potomac and other more expensive areas around the county is happening because of the pandemic-driven need for more indoor and outdoor space, home offices, pools and more," said Samer Kuraishi, a Best of Zillow Premier Agent and President of The ONE Street Company, a boutique real estate firm in Washington, D.C. "We're seeing more buyers from afar using technology to tour homes and buy 'sight unseen.' The sellers who have a great media package, including a floor plan with dimensions, virtual staging and 3D imaging, have the edge in such a competitive market."
Click here to learn more from the Zillow report.