Million-dollar houses aren't what they used to be, as homebuyers across the US can attest.
Gone are the days when seven-figure sums are automatically associated with massive homes on picturesque properties. In fact, in some of the nation's competitive markets, $1 million is nothing more than the price of admission to home ownership.
US property values have soared since the financial crisis during a widespread housing shortage that created a home affordability crisis for buyers. The multi-decade-high inflation surge during and after the pandemic also contributed to home-price appreciation.
This housing-market boom is best exemplified by major cities in California, like Los Angeles and San Francisco. The median cost of a home in those markets has nearly doubled in the last decade — from $420,300 in 2014 to $854,800 now and $769,600 to $1,449,000, respectively, according to data from the National Association of Realtors cited by real-estate site Zoocasa.
Most homebuyers will be out of luck looking in the Golden State, which has seven of the 10 priciest housing markets in the US and will soon have four cities where the typical single-family home costs more than $2 million — including San Jose, San Francisco's Bay Area neighbor.
Persistent property-price growth means that home affordability will likely remain stretched, even as mortgage rates recede to lower levels. That means buyers may still have limited options.
"As prices creep up higher and higher, future home buyers may look outside of these large metros if income growth doesn't start to keep pace with the cost of housing," wrote Zoocasa's Mackenzie Scibetta in a mid-October report.
Though many families will be priced out of this market, those who can swing a home purchase may want to consider it before property prices rise even further in the coming decade.
"While rising prices may seem daunting, they also offer the promise of long-term equity gains, providing stability and a solid return on investment down the road," Scibetta wrote.
18 top cities for real-estate investorsNo real-estate analyst can predict exactly how much or how quickly home prices will rise, though past gains can be a solid harbinger of what's ahead.
With that in mind, Zoocasa researchers compiled data on single-family home price growth from 40 large US markets dating back to 2014, and then extrapolated them out over the next decade to estimate when cities would see their median home prices breach the $1 million mark.
Factors like interest rates and the economic climate will certainly change, though this can be a solid starting point for buyers or real-estate investors who are comparing markets to buy in.
"While growth rates offer a helpful estimate, they may not hold steady if the market experiences drastic changes," Scibetta wrote. "However, they can still provide a general sense of where prices could head in the future."
Of the 40 metropolitan areas used in this analysis, Business Insider limited the list to cities that are within 50% of the US median home price, which was $422,100 in the second quarter, according to the National Association of Realtors. That means the cutoff point was $633,150.
Below are 18 cities with homes that cost $633,150 or less in Q2 that are set to be million-dollar markets by the end of 2035, sorted by which will reach the $1 million threshold the fastest. Along with each reasonably priced real-estate market is its median home price and projections for the years ahead, as well as the home price growth rate from 2014 to 2024 that it's based on.