In a single Bay Space metropolis, almost half of houses are value over $1 million (it isn’t San Francisco)
Two cities in the Bay Area dominate the list of major US metropolitan areas with the most homes valued at over $ 1 million – well above all others, according to a new study.
A study by mortgage website LendingTree, which surveyed the country’s 50 largest metropolitan areas, found that nearly half of all owner-occupied single-family homes in the San Jose area – 47.3% – are worth $ 1 million or more.
That was by far the largest share among the large US metropolises. San Francisco followed in second place, with 36.3% of its homes in the $ 1 million and above category.
The proportions are based on the latest available data from the Census Bureau, which examined home values collected from 2015 to 2019. The estimates are adjusted to 2019 dollars.
The numbers differ from the more commonly published median home price, which is based on sales data – the median home price in San Francisco, for example, was $ 1.8 million in April.
Greater San Francisco, according to the census, includes Oakland, Berkeley, and San Mateo, as well as other cities such as Walnut Creek and Redwood City. The metropolitan area of San Jose includes Sunnyvale and Santa Clara, as well as smaller towns in South Bay such as Palo Alto.
According to the LendingTree study, San Jose and San Francisco represent an extreme – in all 50 major US metropolises only 4.3% of the houses have reached or exceeded the million dollar mark, only a fraction of the numbers in the bay.
“San Francisco and San Jose are both fairly densely populated areas that tend to be home to really high-paying industries like technology,” said Jacob Channel, senior business analyst at LendingTree. “As a result, you have a lot of wealthier homebuyers competing for not many homes, which is putting really high upward pressure on house prices.”
Two other California metropolitan areas round out the top four on the list: Los Angeles ranks third after San Francisco with 17% of its homes valued at or over $ 1 million, followed by San Diego at 12.2%, according to the Analysis of LendingTree.
On California’s four metros, an average of 28.19% of homes are worth at least $ 1 million. The study says that the entertainment industry, along with technology, is contributing to the concentration of wealth in these areas.
Channel expects the proportions of million dollar households in these areas to be even higher this year.
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“The whole of 2020 and this year too, the housing market was really very hot. House prices have really gone up across the country, ”he said. “So it’s very likely that there are more million dollar homes in both San Jose and San Francisco.”
Other major metropolitan areas in the top 10 for the proportion of million dollar housing are No. 5 New York City with 9.9%, No. 6 Seattle with 8.5%, No. 7 Boston with 7.4%, and No. 8 Washington, DC, at 6.7%. The top 10 were rounded off by No. 9 Miami with 4.5% and No. 10 Denver with 3.5%.
At the other end of the spectrum, Buffalo, NY, was the metropolitan area with the lowest proportion of million dollar homes at 0.5%.
For this study, LendingTree used data from the US Census Bureau’s 2019 American Community Survey with five-year estimates and looked at the proportion of owner-occupied homes with or without a mortgage worth $ 1 million or more. To find out, LendingTree divided the number of owner-occupied units priced at $ 1 million or more by the total number of owner-occupied units in the area.
Danielle Echeverria is a contributor to the San Francisco Chronicle. Twitter: @DanielleEchev Email: danielle.echeverria@sfchronicle.com