Starter homes cost $1 million in 233 US cities, Zillow analysis finds

The number of cities where a typical "starter home" costs $1 million or more has risen to a shocking number, a new analysis from Zillow found. 

In the U.S., there are 233 cities where the lowest third of home values are worth at least $1 million – and nearly half of those are in one state. Five years ago, there were only 85 such cities. 

Where do starter homes cost $1 million? 

Local perspective:

California still has the most cities with $1 million starter homes by a wide margin, but now 25 U.S. states have at least one such city:

What they're saying:

 "First-time buyers are facing a market where prices that once seemed unimaginable have become reality," said Kara Ng, senior economist at Zillow. "The encouraging news for buyers is that starter homes remain well below $1 million in most of the country. With more homes hitting the market, listings lingering longer, and sellers cutting prices at record rates, buyers are starting to regain some negotiating power."

RELATED: March 2025 data shows home values flattening as sellers outnumber buyers

Dig deeper:

Cities with $1 million starter homes still represent a small piece of American real estate, but the rising cost of housing has led to many young households postponing homeownership. 

Mortgage rates spike, but spring season ‘off to strong start’

By the numbers:

Mortgage rates have spiked in recent weeks as President Donald Trump’s tariffs have led to instability in the bond market. 

Freddie Mac's latest Primary Mortgage Market Survey, released April 17, showed the average rate on the benchmark 30-year fixed mortgage increased to 6.83% from last week's reading of 6.62%.

RELATED: 5 best US cities to buy and sell a home right now, according to Zillow

The average rate on a 30-year loan was 7.1% a year ago.

"The 30-year fixed-rate mortgage ticked up but remains below the 7% threshold for the thirteenth consecutive week," said Sam Khater, Freddie Mac’s chief economist. "At this time last year, rates reached 7.1% while purchase application demand was 13% lower than it is today, a clear sign that this year’s spring homebuying season is off to a stronger start."