Million-dollar homes nearing 10% of market as property prices rise

Nearly one in ten homes in the U.S. are worth at least $1 million dollars, close to all-time-high levels of June 2022, according to a new report from Redfin.

Just over 8% of homes are worth $1 million or more, not far off the high of 8.6% in June. This upswing in home prices comes on the heels of a major dip in February, when only 7.3% hit the $1 million price threshold. 

Home prices are increasing on a year-over-year basis after declining at the beginning of the year. The median U.S. home-sale price rose 3% year over year in July, the biggest increase since last November. Prices are rising faster for luxury homes, with the median sale price of up 4.6% year over year to $1.2 million in the second quarter.

Of course, elevated mortgage rates are symbolically handcuffing homeowners who want to cling to lower mortgage rates. As a result, inventory is scarce and homebuyers are competing for few available homes on the market. Steady demand is driving up prices, and affordability issues persist as buyers contend with high rates.

The number of homes actively for sale decreased by 6.4% compared to last year, according to the July Monthly Housing Market Trends Report from Realtor.com. 

“In most of the country, expensive properties that are in good condition and priced fairly are attracting buyers and in some cases bidding wars, mostly because for-sale signs are few and far between right now,” says Redfin Economics Research Lead Chen Zhao. “Recent economic signals that the U.S. may avoid a broad recession could cause high-end buyers to feel more confident in making a major purchase in the coming months. There may be more demand coming down the pipeline.” Hence, “there’s no rush to offload high-value homes.”

Meanwhile,, the share of homes worth seven figures has doubled from pre-pandemic levels, just over 4% of homes were valued at $1 million or more in June 2019. The share shot up when home prices skyrocketed in 2020 and 2021 as record-low mortgage rates and remote work drove Americans to buy homes.

Home prices in East coast metros are rising the fastest

Million-dollar homes are increasing quickly in some parts of New England. For example, 25.8% of homes in the Bridgeport, CT metro are worth at least $1 million, up from 23.1% a year ago, the biggest increase among metros in Redfin’s analysis. Boston, where the share increased from 20.3% to 21.5%, was second, followed by Newark, NJ (8.7% to 9.7%).

Nationally, the number of homes worth $1 million or more rose year over year in 55 of the 99 most populous U.S. metros. However, the uptick remains small, less than one percentage point, in almost all of those.

The share of seven-figure homes is falling in West Coast metros 

Expensive coastal metros are losing million-dollar homes fastest. Seattle scored the biggest drop in share of expensive houses, from 39.3% to 33%. Oakland, CA (55.1% to 49%) and Oxnard, CA (40.2% to 34.5%) placed second and third, respectively.

Los Angeles, San Diego, San Jose, San Francisco, Anaheim, New York and Washington, D.C. are also among the metros that saw drops in the number of million-dollar homes.

Still, California has the highest share of million-dollar-plus homes in the country, by far.

Million-dollar homes are rare in some parts of Texas and the Rust Belt

Few million-dollar homes can be found in several inexpensive metros, including parts of Texas and upstate New York.

For example, the share of homes worth $1 million or more is 0.5% or lower in Omaha, NE; Dayton, OH; McAllen, TX; El Paso, TX; Akron, OH; Detroit; Buffalo, NY; Elgin, IL and Rochester, NY.