Record number of U.S. homes valued at over $1 million

Even with mortgage rates progressively declining in recent months, high home prices due to a lack of inventory continue to keep homebuyers at bay. In the last year, the United States hit a record number of cities with a typical home value of $1 million.

“Nearly 1 in 10 (8.5%) U.S. homes are worth $1 million or more, the highest share of all time,” according to a Redfin report. “That’s up from 7.6% a year ago and more than double the 4% share before the pandemic.”

Utah had two cities join the million-dollar home average club last year, making it six total: Kamas, Alta, Granite, Alpine, West Mountain and Park City. In total, the U.S. has 550 million-dollar cities, per a recent Zillow report.

The effect of high home prices

According to a survey by financial company IPX1031 , more than half of Americans (59%) are waiting for prices to decrease before entering the housing market, and 45% consider their current home their permanent residence because they don’t want to lose their current interest rates.

Other findings from the survey in homeownership for Americans in 2024:

• Unrealistic to buy a home currently — 70%.
• Generation Z who cannot afford a home — 87%.
• Millennials who cannot afford a home — 62%.
• 1 in 4 don’t believe home ownership is a good investment.
• 1 in 3 don’t believe owning property should still be considered the American dream.

Another record-breaking number is that 15% of homes that were under contract in June saw buyers back out due to high prices and mortgage rates, the highest ever recorded for that month.

The average home value in Utah last month was $521,221, Zillow reported. The typical home value in Park City was $1,577,361, a 4.1% increase from the year before.

“Home prices, insurance and mortgage rates have shot up so much that many people are either priced out of the market or weary of committing to such a high monthly payment,” Julie Zubiate, a Redfin Premier agent, said, per Redfin.

In the last year, the whole country has seen an uptick in million-dollar homes for sale in the most populated cities, with the exception of Austin and Houston, Texas, and Indianapolis, Indiana.

Why are prices so high?

Simply put, the housing shortage is a big issue. There are not enough homes available for the demand needed by homebuyers.

“Utah faces a worsening housing affordability crisis. The state’s population is booming, but there aren’t enough homes to keep up,” according to the Utah Geospatial Resource Center . “The University of Utah’s Kem C. Gardner Policy Institute study predicts a shortage of over 37,000 units, this year.”

This is not a new issue, but the housing industry has struggled to keep up with the increasing population. To combat the shortage, Utah Gov. Spencer Cox recommended a $150 million investment last December with a goal of building 35,000 starter homes by 2028.

“The single greatest threat to our future prosperity, the American dream and our strong communities is the price of housing. Our kids will never be able to call Utah home if we don’t start building starter homes again,” Cox said in the news release . “With the goal to build 35,000 new starter homes, the Utah First Homes Program would provide new funds for infrastructure, help for homebuyers through grants and sweat equity programs, funding to incentivize innovation and more.”