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Axios
09-05-2025
- Business
- Axios
Starter homes in South Florida hit $1 million
Eight communities in South Florida are among the growing list of U.S. cities and towns where a typical starter home costs at least $1 million, according to a Zillow report. Why it matters: It's a sharp reminder that homeownership is slipping further out of reach, especially for younger people. The median age of first-time buyers is pushing 40, the oldest on record, data shows. The big picture: Half of all states have at least one city with million-dollar starter homes, up from 10 states five years ago, Zillow found. There are 11 such communities in Florida, up from just four in 2020. Zoom in: In Miami-Dade County, Fisher Island, Golden Beach and Pinecrest were included in the list, with prices ranging from around $1.1 million in Pinecrest to upward of $4 million in Golden Beach. Elsewhere in South Florida, Jupiter Inlet Colony, Golf, Manalapan and Gulf Stream in Palm Beach County and Southwest Ranches in Broward County were also featured on the list. The latest: Home prices are still climbing, though not as quickly as before, and mortgage rates remain stubbornly high. The median existing home price rose 2.7% to $403,700 in March, the 21st straight month of year-over-year increases, per the National Association of Realtors. What they're saying: "While cities with $1 million starter homes still represent a small piece of American real estate, they are a striking symbol of how the pandemic housing boom reshaped affordability," Zillow's Anushna Prakash wrote in the report. What we're watching: Some may skip starter homes altogether.
Axios
07-05-2025
- Business
- Axios
Where starter homes cost at least $1 million
There are now 233 U.S. cities where a typical starter home costs at least $1 million — nearly triple the number from March 2020, according to a Zillow report. Why it matters: It's a sharp reminder that homeownership is slipping further out of reach, especially for younger people. The median age of first-time buyers is pushing 40, the oldest on record, data shows. The big picture: Half of all states have at least one city with million-dollar starter homes, up from 10 states five years ago, Zillow found. Minnesota (Minnetonka Beach) and Rhode Island (New Shoreham) recently joined the list. California cities continue to dominate. The latest: Home prices are still climbing, though not as quickly as before, and mortgage rates remain stubbornly high. The median existing home price rose 2.7% to $403,700 in March, the 21st straight month of year-over-year increases, per the National Association of Realtors. What they're saying: "While cities with $1 million starter homes still represent a small piece of American real estate, they are a striking symbol of how the pandemic housing boom reshaped affordability," Zillow's Anushna Prakash wrote in the report. What we're watching: Some may skip starter homes altogether.
Yahoo
27-04-2025
- Business
- Yahoo
A starter home now costs $1 million in half the states in the U.S., report reveals
Buying a starter home as a first-time buyer is supposed to be exciting, and a recognition of financial security. But in more U.S. cities, getting a starter home is even more out of reach, given the $1 million barrier to entry in hundreds of cities. A new housing report reveals the hurdle to becoming a first-time homebuyer is now even higher in hundreds of U.S. cities. Housing platform app Zillow reports there are now 233 locations in the U.S. where a simple 'starter home'—a smaller, less-expensive route to owning a larger house—will now run you $1 million or more. The increase represents a dramatic rise from five years ago when there were only 85 cities with million-dollar starter homes. The implications include significantly higher down payments, elevated monthly mortgage payments and more difficulty for low- and middle-income buyers to get on the path to homeownership. And it's not just a California problem, wrote Zillow economic analyst Anushna Prakash. New York, New Jersey, Florida, Massachusetts, Washington, and Texas now boast cities in the million-dollar-starter-home club. This is even more evidence that the housing affordability crisis is 'here to stay,' according to new research from Oxford Economics. In a briefing this month, the firm reported the national Housing Affordability Index (HAI) was 72.8 in the last quarter of 2024, which means a household that earns the U.S. median income of about $80,000, only had 73% of the money it would need to afford a median-priced home. That means a prospective homebuyer would need a pay hike of about $30,000 to make it work at that home price. And there are no quick fixes on the horizon, according to Oxford Economics. Even if home prices stay flat this year, the HAI isn't projected to approach the affordability threshold until after 2035. Other factors like higher property tax and insurance, low housing inventory, and poor prospects for lower mortgage rates are also major factors. According to Federal Reserve Economic Data, the median home price has risen 31% in the past five years. In 2020, the median sales price was $317,000 compared to the current median price of $416,900. Even though that price is down from its late 2022 peak of $442,600, prices are still significantly higher than they were five years ago. Builders have also signaled that President Trump's tariffs won't do hopeful homebuyers any favors. Tariffs on imported goods are projected to have a cost impact of $10,900 per home, according to a National Association of Home Builders and Wells Fargo Housing Market Index survey. D.R. Horton, a $39 billion homebuilder, missed earnings estimates this month and cut its revenue forecast for the year down to $33 to $34.8 billion from $36 billion to $37.5 billion. CEO Paul Romanowski told investors the spring home-selling season, usually the busiest period for buyers and sellers, is suppressed because of plunging consumer confidence and affordability issues. 'This year's spring selling season started slower than expected, as potential homebuyers have been more cautious due to continued affordability constraints and declining consumer confidence,' Romanowski said. ''We expect our incentive levels to remain elevated and increase further, the extent to which will depend on market conditions and changes in mortgage interest rates.' This story was originally featured on
