The Half-Million Metro Club Is Growing—11 Housing Markets Now Surpass $500,000
Home prices across the U.S. have grown 19.2% over the past 12 months with 11 metro areas now reporting median list prices of $500,000 or more, Fortune reports. Rising home prices posed a much smaller challenge to buyers at the start of the pandemic when mortgage rates were historically low and for sale properties were in greater supply. Now, the 30-year fixed-rate mortgage is up to 5%, and with only a meager supply of homes left on the market, buyers are feeling the sting.
While cities like San Francisco and Los Angeles joined the half-million dollar club long before the pandemic, other metros like Austin, San Diego, and Denver have seen home prices rise by over 20% in just the last 12 months. In Salt Lake City, prices are up by a staggering 30%.
“Prices will continue to grow in the short-term, which means the number of housing markets in that $500k or above range could grow over the next few months, since there are a number of markets in that $400k to $500k range,” Chris Heller, chief real estate officer at OJO Labs, told Fortune.
In some of the $500,000 cities where costs are highest, homebuyers may have to settle for prices that were unthinkable two years ago. In San Francisco, for instance, studio apartments selling for $540,000 are still so cramped that beds must be retracted into the ceiling during the day.