A record 8.2 percent of homes were valued at $1 million or more in February, according to a new report from Redfin released Wednesday.
The figure represents approximately 6 million American homes that hit the $1 million mark in February, a sharp increase from February 2020 on the eve of the pandemic when just 4.8 percent of homes — or 3.5 million — had a $1 million-or-more price tag.
While it’s not unusual for home values to increase over time, the rate at which more and more homes have crossed the million-dollar threshold has been greatly exacerbated by the pandemic housing market, which has seen a record number of buyers competing for a dwindling supply of homes driven by remote work relocation and low-interest rates. While it has been a boon for homeowners looking to cash in on their equity, it has also pushed more and more buyers out of the market.
“The surge in housing values has turned many homeowners into millionaires, but has pushed homeownership out of reach for a lot of other Americans,” Redfin Deputy Economist Taylor Marr said in a statement. “Incomes have increased, but not as fast as home prices, which means many people are stuck renting or have to move somewhere more affordable if they want to buy a home.”
Of the top 10 cities with the most million dollar homes, seven are in California, according to the report, with San Francisco topping the chart with a mind-boggling 88.7 percent of homes worth at least $1 million. San Jose came in at a close second with 85.9 percent homes worth $1 million, before a sharp drop off brought Anaheim in at third place where 55.3 percent of homes are over $1 million.
Anaheim has also seen the largest jump in million dollar homes out of any of the top 10 cities, with its 55.3 percent data point 28 percent higher than its share in 2020.
The Bay Area has long been seen as the most expensive place to live in the country with a median sales price of $1.4 million thanks to its status as a tech hub. While the pandemic has disrupted patterns of work, prices have continued to grow in the area even as cities like Austin have emerged as tech hotspots.