The number of US cities where first-time homebuyers are faced with at least a $1 million price tag on the average entry-level home has nearly tripled in the past five years, according to new research.
A Thursday report from Zillow indicates that a typical starter home is now worth $1 million or more in 237 cities, up from 84 cities in 2019, underscoring America’s ongoing home affordability crisis.
“Affordability has been strained across the board,” Orphe Divounguy, a senior economist at Zillow, said. “We see the largest number of million-dollar starter homes in expensive coastal markets. We see them in markets with very low homeownership rates and we see them in markets with more building regulations.”
I’m wondering what a “starter home” is in this case.
For me that’d be about 40sqm and 150k €
Are people buying bigger homes than they need?
It’s nearly impossible to find smaller homes in some areas of the US. I lucked out and bought an 800 sq ft home for my starter. I’m now in a 1600 Sq ft condo and it’s more room than my partner and I need. I’m hoping to downsize.
I’m wondering about that too.
In my area, i was above starter home (because of updates) on a 2 bedroom, 1 bath house built in 1946, on a fraction of an acre. But we have an older stock of houses. Where my brothers live, those are not even choices. Those towns really didn’t exist at that time, so most of the houses are much newer, much bigger, on much bigger lots
I lived in a house in Japan that was a rental. It was about 55sqm + loft with a parking space out front (which became my container garden). It was pretty good for the wife and I with me working from home (so using the 2nd bedroom as an office). I looked at what it would cause to buy a similar house used (far western Tokyo about 1.5 hours to Shinjuku station, neighbors on two sides the legally required 90cm or whatever it was away) – 50 million yen give or take a bit. Someone might look at the price in USD or EUR or something and think it’s not much, but it is for someone getting paid in said yen.
America is deeply obsessed with single family homes.
Most homes are 90 m² or larger. I’m in a medium sized city in the midwest and I have a 3 bedroom 130 m² home I got for 115€ but it’s already inflated in value in the last 15 months to 138€. I wouldn’t be able to afford the house I purchased 15 months ago, if I was house shopping now. And homes currently cost nearly double what they did in 2019.