SLIPPING OUT OF REACH

Starter Homes Now Cost $1M+ in More Than 200 US Cities As House Prices Surge

The number of cities has tripled since March 2020.

A typical starter home now costs $1 million or more in more than 200 U.S. cities, according to a new report from Zillow. Five years ago, there were only 85 cities in 10 states where starter homes—defined as being in the lowest third in terms of home values—exceeded $1 million. Now the number is up to 233 cities in 25 states. California has the most cities with $1 million starter homes, or 113, followed by New York with 32 cities and New Jersey with 20 cities. But cities in Minnesota, Rhode Island, Washington, Texas, Wyoming, Arizona, Illinois, Utah, and Kansas all made the list. The figures provide one example of how the coronavirus pandemic housing boom has continued to impact home affordability. Many households are postponing home ownership, driving up demand and prices for single-family rentals. The median age for first-time buyers is pushing 40, according to the National Association of Realtors.