Los Angeles has the third-largest concentration of million-dollar homes out of 50 major U.S. cities, according to a recent report by online mortgage lender Lending Tree.
The data shows that Los Angeles has 2,098,772 housing units, with 400,562 (or 19%) valued at or above $1 million. The median value of owner-occupied housing units in the city is $650,300.
The study looked at data from the U.S. Census Bureau’s 2018 American Community Survey with one-year estimates. Lending Tree divided the number of housing units priced at $1 million or more by the number of overall housing units in a metro area to determine the share of million-dollar homes in each area.
Home Prices Increasing in L.A.
In general, California has been experiencing a boom from the high-tech industry, resulting in a tougher housing market. Specifically, the tech industry brought in a flood of workers from around the country and elsewhere, all in need of somewhere to live.
With fewer housing options available, prices began to rise as demand increased. This pushed out less-skilled, lower-income earners, driving prices up even higher as more skilled workers with larger salaries came in to take their places.
What’s more, building new housing can also be difficult at times in Los Angeles, especially when it comes to high-density housing such as condos or apartments. In fact, three-quarters of residential land in the city is zoned for single-family homes only.
With minimal new construction in Los Angeles, workers looking to buy homes and current homeowners looking to sell sometimes end up vying for the same existing housing inventory, which drives up the cost of older homes in the city. This has led some current residents to pick up and look for homes elsewhere.
Other U.S. Cities with High & Low Concentrations
Three other California cities – San Jose, San Francisco, and San Diego – join L.A. to top the list of U.S. cities with the highest share of million-dollar homes.
In San Jose, there are 369,724 housing units, with 208,745 (or 56%) of those units valued at or above $1 million. In this city, the median value of owner-occupied properties is $1,091,100.
Out of the 933,904 housing units in San Francisco, 395,858 (or 42%) are in the $1M+ category, and the median value of owner-occupied units here is $910,300.
When it comes to San Diego homes, 84,769 (or 14%) of the 600,545 units are priced at or above $1 million, while the median value of homes in the city is $606,200.
Rounding out the top 10 list of cities with the highest share of million-dollar homes are:
And, the 10 U.S. cities with the lowest share of million-dollar homes are:
- Cincinnati, OH
- Buffalo, NY
- Pittsburgh, PA
- Cleveland, OH
- Columbus, OH
- Memphis, TN
- Indianapolis, IN
- Hartford, CT
- Louisville, KY
- Kansas City, MO
It’s still rare to find million-dollar homes nationally, according to the Lending Tree:
“Only 5.86% of the owner-occupied homes in the nation’s 50 largest metros are valued at $1 million or more.”