These states have the most million-dollar 'starter homes'
A home stands in Atherton, California, U.S., on Tuesday, Feb. 18, 2020. For the fourth straight year, Atherton topped Bloomberg's Richest Places annual index. Photographer: David Paul Morris/Bloomberg via Getty Images
More than half U.S. states now have at least one city with million-dollar starter homes, according to a new study.
A new Zillow analysis found that 242 U.S. cities now have starter homes worth at least $1 million, nearly triple the 80 cities from before the COVID-19 pandemic.
The pandemic reset the market for home buyers. After 2020 the number grew from a handful of coastal states to more than two dozen across the country.
By the numbers:
The 242 cities are spread across 26 states in the U.S. with starter homes valued at $1 million or more.
Last year, there were 226 cities where buying a starter home cost at least $1 million. That number has since grown, showing that the effects of the pandemic-era housing boom are still being felt.
A long-standing housing shortage and strong demand fueled by historically low mortgage rates helped drive home prices to record highs, keeping many starter homes out of reach for buyers, according to Zillow.
Dig deeper:
Zillow defines a starter home as a property in the lowest third of home values within a local market. Nationwide, the typical starter home is still valued at about $198,600, which is up 1.7% from a year ago.
State geography of million-dollar starter homes
Prior to the pandemic, most of the million-dollar starter homes were found in coastal states. Now it's no longer confined to coastal spots, but instead has expanded into an ovate pattern across parts of the Northeast and West Coast, reflecting the spread of soaring home values.
With 105 cities, California continues to lead the nation with the highest number of cities where starter homes cost at least $1 million. Other areas such as New York and New Jersey, with 41 combined, are growing faster from just 12 before the pandemic.
Local perspective:
Leading the way for metro areas where a typical starter home costs $1 million or more is the New York City metro area, which includes parts of New Jersey and Pennsylvania. They have 63 cities, followed by the San Francisco metro area with 37. Los Angeles (33), San Jose (13) and Miami (8) round out the top five.
The Source: This story was written with information provided by Zillow. This story was reported from Orlando.