24/7 Wall St. Insights

• The number of homes valued at $1 million has risen to an all-time high.
• The cities with the highest percentage of $1 million homes tend to be in California.
• Also: Dividend legends to hold forever.

The median value of a home sold in America during July was $425,000, an all-time high. Almost every home sold was at the listing price. Home demand has clashed with owners who want to keep their homes, often because they got 3% or better 30-year fixed-rate loans before those rates recently moved closer to 7%.

Home prices have increased, driving the number of homes valued at $1 million to an all-time high. According to Redfin, that figure has risen to 8.5% of all homes in the United States. Before the pandemic, the figure was 4%. Redfin also reports, “Prices are rising even more for homes that are already expensive.”

“The median sale price of U.S. luxury homes rose 9% year over year to a record $1.18 million in the second quarter,” Redfin analysts report. This has lifted the net worth of many of the owners of these homes. In a few markets, home prices are falling.

Redfin examined the 50 top U.S. markets based on population. It used MLS and proprietary data to determine the percentage of $1 million homes in each market.

The cities with the highest percentage of $1 million homes tend to be clustered around San Francisco, San Diego, and Los Angeles. The list also includes several of the largest cities on the East Coast.

The market with the highest percentage of homes worth over $1 million is San Francisco, at 80.5%, followed by nearby San Jose, at 80.1%. The theory is that the people who have gotten rich in the tech industry live in these cities and surrounding areas.

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