Zillow, the tech-based US real estate marketplace recently reported that typical starter homes in around 237 cities in the country are valued at $1 million or higher. The prices are way above the amount that an average American homebuyer can afford to pay for a starter home, which Zillow categorizes as a real property in a given region that is priced in the lowest third of house values.
More than half of the 237 US cities with $1 million worth starter homes are situated in California. New York and New Jersey have respectively 31 and 24 cities with pricey starter homes.
The new Zillow report states that the cost of houses has been rising ever since the pandemic as a result of growing demand, housing shortage and increasing inflation. According to Zillow, between 2019 and 2024, starter homes valued at $1 million were listed for sale in 84 US cities only. Today, more than 200 US cities have pricey starter homes valued at $1 million or higher. As a result, many first time, median income buyers had to shelve plans of buying even a starter home that Zillow describes as having a comfortable and affordable price of $196,611 on a national level.
Increase in Home Inventory Can Hold Down the Real Estate Market’s Median Price
U.S. realtors are saying that changes are about to take place since smaller and comfortably priced homes up for sale in the market have been growing in numbers. After all, rising inventory can help hold down the median price of real estate, since buyers will have more negotiating power by having more options.