A record 8.2% of homes in the United States are now worth $1 million or more, up from 4.8% just two years ago, according to a March report from Redfin. New research shows that some major cities still have affordable housing available, but it is becoming increasingly scarce.
In a recent analysis of the most populous and expensive US cities, real estate analytics firm Point2 found that five of them – San Francisco; Irvine, California; Oakland, California; Gilbert, Ariz.; and Henderson, Nevada — had no starter homes, or those listed for less than $150,000, available on the market.
“Basic housing need is so critical and essential,” said Doug Ressler, director of business intelligence for Yardi Matrix, a division of Point2’s parent company, Yardi Systems. “Right now, it’s believed that home affordability is down.”
According to the Point2 study, the market share of affordable housing exceeded 10% in only two US cities: Mesa, Arizona, and St. Petersburg, Florida. The percentage of affordable housing dropped dramatically from there. In Dallas and Tampa, Florida, the next two cities on the list, the share of affordable housing was just over 5%.
For its analysis, Point2 looked at the 50 most populous US cities with the highest median home prices, then ranked them based on the share of listings below $150,000 in the last four week of March. websites: Point2, Zillow, Redfin and Realtor.com. .
The results were often hyperlocal, with neighboring towns having very different markets. For example, in Phoenix’s satellite city of Mesa, the share of affordable housing was nearly 15%; at neighboring Gilbert, the share was nil. Honolulu ranked fifth among the top 10 cities with the highest proportion of affordable housing, at just under 5%, even though it had a relatively high median price of $870,000.
The disparities are often the result of public policies and local ordinances aimed at increasing the supply of affordable housing, Ressler said, citing states like California and Connecticut, which have revised zoning laws to give communities more flexibility to increase housing density.
“People have to find the right fit, the right shoe size,” he said. “Not all policies will fit everywhere.”