A record number of homes are worth more than $1 million

The number of U.S. homes worth more than $1 million nearly doubled since before the pandemic, to 8.2% in February from 4.8% in February of 2020, according to Redfin.

Why it matters: While rapidly appreciating home values are a windfall for those who own them, they also mean that more and more Americans are priced out of the market.

• Incomes are rising, but not as quickly as home prices — leaving many people stuck as renters.

Driving the news: Redfin, the discount real estate brokerage, says the percentage of U.S. homes valued at the symbolically meaningful sum of $1 million or more has hit a record — a trend led by the Bay Area.

• Nearly 9 out of 10 properties in San Francisco and San Jose are million-dollar listings.
• Anaheim, California, saw the biggest increase in $1M+ homes: 55% of the housing stock fell into that category last month, versus 27% two years ago.
• Seven of the top 10 cities for $1M+ homes are in California — led by San Francisco, where the percentage of properties worth that amount was a whopping 88.7% in February.

The big picture: Low mortgage rates and pandemic trends like remote work have helped pour gasoline on the hot housing market, where realtors and buyers alike complain of the historically low inventory of homes for sale.

• “During the four weeks ending Feb. 27, the number of homes for sale plummeted 50% from two years earlier to an all-time low of 456,000,” Redfin says.
• “That helped fuel a 33% rise in the median U.S. home-sale price, which hit a record high of $363,975.”

Details: Here’s a selection of metro areas and their percentage of homes worth more than $1 million:

• Albuquerque, New Mexico: 25%
• Boston: 18.1%
• Austin, Texas: 12.3%
• Washington, D.C.: 10.9%
• Denver: 9.7%
• Phoenix: 7.8%

On the low end, Elgin, Illinois, came in at just 0.1% — a lower share than any other metro Redfin analyzed.

• Next came El Paso, Texas; Columbia, South Carolina; McAllen, Texas; Dayton, Ohio; and Buffalo, New York, all at 0.2%.

Methodology: Redfin says its analysis uses the “Redfin Housing Value Index,” which uses the Redfin Estimate (a market calculation tool), public records and MLS data to estimate the current and historical value of more than 85 million properties in the U.S.