A record number of homes in the U.S. sold for $1 million or more in recent years, according to a new analysis by Zillow. The share of single-family homes that were purchased for $1 million or more increased from 2.5% in 2020 to 6.4% today, more than doubling in two year’s time.
Metropolitan areas drove most of the sales volume growth, with Portland leading the pack. The Rose City, home to a red-hot housing market, logged a 253% increase in the number of $1 million-plus homes since mid-2019.
The catch is that the properties sporting seven-figure price tags are getting smaller and smaller each year. Homes that sold for $1 million or greater have shrunk in square footage across nearly every major metropolitan area and nationally by 397 square feet, about the size of a standard two-car garage, since 2020.
The largest declines took place in Phoenix and Nashville, while floor plans grew, if only by a hair, in only two major Midwestern metros: Minneapolis and St. Louis.
Other key findings:
- Following Portland, Austin—a market that is all the rage lately—saw sales jump by 220% since 2019.
- Sales rose the least in San Jose and San Francisco, while Boston was the only metro that experienced a decline in the volume of $1 million-plus transactions, with the share falling by 32%.
- Those looking for the most bang for their million bucks should consider Hartford, Connecticut, and the Midwest. Among the 50 major metros included in the study, Hartford has the lowest price per square foot at $205, followed closely by Indianapolis, Oklahoma City, Kansas City and Cincinnati.
The takeaway:
“Buyers with seven-figure budgets shopping for homes during the pandemic were doing so coming off the longest period of economic growth in U.S. history and with the help of historically low interest rates,” said Anushna Prakash, economic data analyst at Zillow. “Sales for expensive homes soared while buyers in the heat of competition accepted smaller layouts.”
Read the full report here.
