Home prices may have peaked in the summer of 2022, but the most expensive housing markets in the U.S. are still shockingly pricey.
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index is up 6.29% since April of last year. The 20-city index, which measures only the very largest metro housing markets, is up 7.2% over the same time frame.
Both indexes are still up about 8.65% and 8.55% respectively over the past three years, however, and experts see mounting evidence that the recent increase in home prices may already be coming to an end.
After nine months of steadily increasing housing prices in the U.S., price growth has now decreased for the second month in a row according to the Case-Shiller U.S. National Home Price NSA Index,
The bottom line is that despite some recent relief, the most expensive housing markets in the U.S. remain exceedingly costly by historical standards and they aren't expected to get much cheaper anytime soon.
To determine what average home prices look like on the ground in the nation's most expensive housing markets, we turned to the latest data from the Council for Community and Economic Research (C2ER). Their cost of living index measures prices in 265 urban areas for housing, groceries, utilities, transportation, healthcare, and miscellaneous goods and services (such as getting your hair done or going to a movie).
Signs of inflation abound, but home prices are what really stand out. This year the increase slowed greatly. As of the beginning of 2024, the average price of a home in the U.S. came to $508,666, according to C2ER, up from $500,584.
Most expensive housing markets in the U.S.
That sticker shock is even more salient in a select set of U.S. cities.
With C2ER's data in hand, we were able to identify the 15 most expensive housing markets in the U.S. — and the premiums home prices command to the national average. (Spoiler alert: the 15 U.S. cities with the highest average home prices have an average home price of $1.34 million, or 2.7 times the national average.)
So just how costly do the most expensive housing markets in the U.S. get? Take a closer look at the U.S. cities with the highest average home prices. For good measure, we've also included data on median household incomes, average rents, related housing costs and other pertinent information. (For comparison's sake, here's a look at the most expensive cities in the U.S., where residents are willing to pay more for everything in exchange for the opportunities the cities offer).
Disclaimer
Source: C2ER's Cost of Living Index, 2023 Third Quarter Data, published October 2023. Index data is based on average prices of goods and services collected during the first three quarters of 2023, with index values based on the new weights for 2023. Population data, household incomes, home values, poverty rates and other demographic information are from the U.S. Census Bureau.
15. Oakland, California
- City population: 430,531
- Median household income: $93,146 (U.S.: $74,755)
- Average home price: $920,364 (U.S.: $508,666)
- Premium to U.S. average: 77%
Next to Berkeley and within commuting distance to San Francisco, this city needs neither of them to entice foodies, culture seekers and nature lovers. Oakland enjoys a warm-summer Mediterranean climate with an average of 260 sunny days per year.
Alameda County is one of the most appealing of the Bay Area nine counties. Oakland has more than 50 distinct neighborhoods ranging from Temescal to tony Rockridge to the Oakland Hills. Lake Merritt attracts picnickers, boaters and birders, is the oldest wildlife refuge in America and is considered the jewel of Oakland. All of this beauty comes at a steep cost. Oklandites pay 77% more than average for housing-related expenses, including rents and mortgages, than most Americans. Their mortgage principal plus interest payments are $4,369 are $1,914 more than the national average of $2,455.
A major West Coast port city, the Port of Oakland is the busiest port in Northern California, and the fifth- or sixth-busiest in the United States.
Bay Area Rapid Transit doesn’t operate 24/7 like New York City’s subway, but BART efficiently connects the East Bay to points farther east, Daly City, the South Bay and beyond. Despite robust public transportation options transportation costs for residents of Oakland still cost 44.6 more than average.
California is ranked by Kiplinger as one of the worst states to retire when it comes to taxes. Some retirees might pay an income tax rate as high as 14.4% if they are still working. Effective for 2024, a California tax expansion mandates a 1.1% payroll tax for employees making more than $1 million.
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14. Bethesda, Maryland
- City population: 68,522
- Median household income: $158,720
- Average home price: $1,017,353
- Premium to U.S. average: 91.4%
What goes for Arlington goes for Bethesda, too. Residents pay a premium to live in the upscale D.C. suburb, which is home to the National Institutes of Health, Walter Reed National Military Medical Center and a number of other prestigious federal government institutions.
As a medical hub, it's perhaps befitting that healthcare costs run about 5.8% lower than the national average in Bethesda. Other major expense categories aren't too bad, either. Groceries and utilities are 9.8% more expensive in this D.C. suburb, and transportation is only 4% more expensive.
The biggest line item contributing to Bethesda's high cost of living? Not surprisingly, it's housing. Renters and homeowners pay a premium of 91.4% to the national average to keep roofs over their heads.
Maryland has both an inheritance and an estate tax. The gas tax in Maryland jumped from $0.427 to $0.47 per gallon this year and is the fourth highest gas tax in the nation.
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13. Arlington, Virginia
- City population: 234,000
- Median household income: $132,380
- Average home price: $1,057,671
- Premium to U.S. average: 103%
Washington, D.C., and its close-in suburbs sport some of the highest living costs in the nation. So it should come as no surprise that Arlington makes the top five for highest home prices on our list.
This suburb, home to the Pentagon and Arlington National Cemetery, sits just across the Potomac River from Washington, D.C. As with its neighbors, Arlington attracts ambitious, well-paid people — and has the home prices to prove it.
Housing-related expenses, including rents and mortgages, are more than twice the national average. Locals can thank an average home price of more than $1 million for much of that financial pain. Average principal and interest payments on mortgages top $5,000 a month in Arlington.
On the plus side for residents, Arlington's median household income of nearly $132,380 is among the highest in the U.S. And its per capita income of $90,878 is more than double the national figure of $41,261.
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12. Seattle, Washington
- City population: 749,267
- Median household income: $115,409
- Average home price: $1,068,450
- Premium to U.S. average: 109.2%
Seattle has long been known for its red-hot housing market, where too little inventory and fierce competition conspired to send home prices skyrocketing for the better part of a decade. Prices have cooled off over the past year, dropping about 5.92%, according to the S&P CoreLogic Case-Shiller Seattle Home Price NSA Index, but Seattle remains one of the most expensive housing markets in the U.S.
A booming tech scene certainly doesn't help matters. Microsoft (MSFT) and Amazon.com (AMZN) are both based in the Seattle area, as are many smaller high-tech companies. The bottom line is that Seattle's average home price is 110% greater than the national average. Overall housing costs — including rents, mortgages and related expenses — are 109.2% higher than the U.S. mean.
True, Seattle's high median household income helps homeowners get by, but those elevated home prices nevertheless take quite a bite. At least residents can take some comfort in the fact that their utility bills run only 2.6% more than what the typical American pays.
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11. San Diego, California
- City population: 1,381,182
- Median household income: $100,010
- Average home price: $1,092,324
- Premium to U.S. average: 110.9%
San Diego, with its miles of beaches and nearly ideal climate, is paradise for those who love the outdoors. Be it surfing, sailing, hiking, biking, golfing or just exploring Balboa Park, this city on the Pacific has something for everyone.
And for those who prefer more sedentary activities, San Diego offers a world-class zoo, museums, professional sports teams and a wide-ranging restaurant scene.
What's not to like?
Well, for one thing, San Diego has one of the most expensive housing markets in the U.S. At more than $1 million, the average home price is 114% greater than the national average.
Or consider it this way: San Diego's median home value comes to $905,300, or 79% higher than the U.S. median of $508.666. The city's median household income, however, is only a quarter greater than the U.S. level. Renters feel the pinch, too, with the average apartment going for $3,210 a month vs the national average of $1,524.
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10. Boston, Massachusetts
- City population: 649,768
- Median household income: $86,331
- Average home price: $999,000
- Premium to U.S. average: 112.8%
With its unparalleled collection of universities, hospitals, historical sites, and tech and biotech companies, it's easy to see why Boston is such an appealing place to live. And while there's no question the city's popularity comes at a high cost, it's not nearly as high as some East Coast cities that are often mentioned in the same breath as Boston.
After all, the high concentrations of students, recent grads and young professionals require some level of affordability to get by while they're starting out. So while the city's overall living costs are almost 44% higher than the national average, that's a relative bargain compared to, say, New York City or San Francisco.
But as one of the most expensive housing markets in the U.S., putting down roots in Boston is another matter entirely. At nearly $999,000, average home prices are almost than twice the U.S. average. Principal and interest payments on mortgages ($4,868 per month) are likewise double what the rest of the nation shells out ($2,455 a month). Keeping the lights and heat on is a pricey proposition, too, with utilities running about 49% higher than the U.S. mean.
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9. Queens, New York
- Borough population: 2,278,029
- Median household income: $80,577
- Average home price: $1,097,857
- Premium to U.S. average: 129.5%
New Yorkers priced out of Manhattan used to move to Brooklyn. But now Brooklyn is no longer a bargain either, and that has folks flocking to Queens.
Not that it's much of a refuge. This NYC borough has one of the most expensive housing markets in the U.S.
Once best known for Archie Bunker and the New York Mets, Queens is becoming trendier by the day — and prices are following suit. The average home price comes to almost $1.1 million, or more than twice the national average.
It should come as no surprise that housing-related costs are also 129.5% greater than the U.S. average. After all, the mean monthly apartment rent comes to $3,424 vs $1,524 a month nationally. And the average mortgage carries a principal and interest-rate payment of $5,687 per month vs $2,455 across the U.S.
Looking at it another way, although Queens' median household income is $5,822 greater than the national median, the borough's median home value of $683,600 outpaces the U.S. median by nearly $174,934.
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8. Los Angeles, California
- City population: 3,822,224
- Median household income: $76,135
- Average home price: $1,279,270
- Premium to U.S. average: 133.3%
Few cities can top Los Angeles for excess and glamor, but most of its residents don't work in Hollywood or shop on Rodeo Drive. While high living expenses make L.A. one of the most expensive U.S. cities, median annual incomes are only $1,380 higher than the national average.
Home prices — and overall housing costs — are the main culprits when it comes to L.A.'s comparative lack of affordability. True, as is the case with many other cities on this list, the area's average home price is skewed by the dwellings of so many high- and ultra-high net worth residents. Regardless, Los Angeles' median home value of $903,700 (vs $508,666 for the U.S.) is still plenty daunting for folks of more typical means.
The city's average home price of $1.28 million offers a premium of 151% to the national average. LA home prices have increased more than 9.04% over the past three years, per the S&P CoreLogic Case-Shiller Los Angeles Home Price NSA Index.
As one would expect, renting is also rough on the wallet. Apartment rents, on average, are 101% more expensive than the U.S. average. That's a far cry from the big cities with the cheapest apartment rents. On the plus side, utilities are only about 14% more expensive in the City of Angels.
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7. Washington, D.C.
- City population: 671,803
- Median household income: $101,027
- Average home price: $1,220,500
- Premium to U.S. average: 135%
As pricey as its suburbs might be, the nation's capital tops them all when it comes to the most expensive housing markets in the U.S.
An average home price of $1.22 million makes buying a house in Washington, D.C. almost 2.4 times higher than the national average. Comprehensive housing-related costs, including rents, mortgages and insurance, are a burdensome 2.35 times the national average, according to C2ER.
Beyond that, however, Washington is something of a tale of two cities when it comes to living costs. Groceries run about 5.2% above the national average, while utilities are about 8% more expensive. Transportation expenses aren't overly onerous, at slightly less than 6.8% above the U.S. average. A wide-ranging bus and metro system makes getting to and around the District of Columbia affordable. The DC Circulator bus, for example, costs just $1 and its routes reach popular spots including Georgetown, Union Station and the National Mall.
And, of course, numerous museums and historical sites are free to visit, too.
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6. Orange County, California
- County population: 3,151,184
- Median household income: $106,209
- Average home price: $1,464,488
- Premium to U.S. average: 159.7%
Although not properly a city itself, we include Orange County on this list because it comprises several large municipalities. Known as The O.C. for short, the county is synonymous with wealth — so much so that there was an entire TV series made about it in the 2000s.
Several large municipalities make up the county, which abuts Los Angeles to the southeast, including Anaheim, Santa Ana and Irvine. But it's the smaller, tonier enclaves such as Newport Beach (median home value: $2 million) that cement Orange County's reputation for sheltering some of Southern California's richest and most famous.
In fact, the average home price for all of Orange County sits at over $1.46 million according to C2ER. That makes it the sixth priciest market in the country — and easily one of the most expensive housing markets in the U.S.
However, at $3,147 a month, apartment rents are only a bit more than twice the national average. All in all, housing in the O.C. costs 159.7% more than what the typical American pays. On the other side of the ledger, healthcare costs are 10% lower than the national average.
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5. San Francisco, California
- City population: 1,537,618
- Median household income: $139,873
- Average home price: $1,401,754
- Premium to U.S. average: 174.9%
Years of relentless growth driven by high-paid tech workers have given San Francisco one of the most expensive housing markets in the U.S. Even those residents who bring home fat paychecks can struggle to make ends meet.
Houses are famously expensive — an obstacle for aspiring homeowners. The average home price is a staggering $1.4 million in San Francisco, according to C2ER. The median home value is an astronomical $1,475,400 million.
Let's pause on that for a moment: Half of the city's homes cost more than $1.475 million.
At $7,090 a month, average principal and interest payments on mortgages are the fourth-highest in the U.S. — or almost 3 times what the typical American pays.
Renters don't fare much better. The average rent for an apartment in San Francisco is $3,862 a month. That's about 2.8 times the national average. Total housing costs, including rents, mortgages and related expenses, are more than 2.8 times the national average, too.
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4. Brooklyn, New York
- Borough population: 2,590,516
- Median household income: $73,951
- Average home price: $1,344,600
- Premium to U.S. average: 176.5%
Technically, Brooklyn is one of the five boroughs that make up New York City, but in recent decades it has emerged as something of a metropolis unto itself. Indeed, if Brooklyn were an independent city, its population would be on par with Chicago, the third-largest city in the nation.
Once upon a time, Brooklyn was considered a viable alternative for those who couldn't afford to live in Manhattan. Those days are long gone. Housing-related expenses including rents and mortgages are almost triple the national average.
And the average home price? Fuggedaboutit. At $1.34 million, Brooklyn homes cost more than three times the national average. Brooklyn is a sprawling borough, where the ultra-high-net-worth residents of, say, Brooklyn Heights, help skew its average home price upward. But its median home value of $849,900 — vs $508,666 U.S. — is shocking too.
And here's the kicker: Brooklyn's median household income is $804 lower than the U.S. median.
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3. Honolulu, Hawaii
- City population: 343,437
- Median household income: $82,006
- Average home price: $1,678,182
- Premium to U.S. average: 213.2%
To enjoy the perks of living in such a remote Pacific paradise, Honolulu residents pay more than they would on the mainland for pretty much everything — and it's not hard to understand why. Most goods sold in Hawaii must arrive either by boat or by plane, which jacks up the price considerably.
Honolulu's average home price is almost 3.3 times greater than the national average. The median home value of $818,700 is likewise brutal. Meanwhile, average monthly principal and interest payments on mortgages come to $8,080. That's 3.3 times the national average of $2,455
Renters face a similar dilemma. The average apartment lease goes for $4,128 per month in Honolulu, vs a national average of $1,524.
And Honolulu's elevated living costs hardly end with housing prices. The city reports the second highest utility bills of all 265 urban areas surveyed by C2ER.
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2. San Jose, California
- City population: 1,797,019
- Median household income: $154,631
- Average home price: $1,817,832
- Premium to U.S. average: 213.9%
San Jose is at the epicenter of tech development in America and hosts major facilities for many companies including Hewlett Packard Enterprise, IBM, Lockheed Martin, Qualcomm and the North American headquarters of Samsung Semiconductor
The abundance of high-paying jobs is necessary if you want to live and work in the area. The typical household income in San Jose is $154,631 and that is twice the average of $74,755.
Housing costs are 213.9% higher than the national average and the mean price of a home is $1,817,832. That is 3.5 times what most people pay nationwide at $508,666. The cost of heating and cooling your home, as well as charging your EV, is in line with housing prices and is 53.6% higher than average. Although it is cheaper than neighboring San Francisco where the costs are 61.2% above the norm.
The biggest line item contributing to San Jose's high cost of living? Not surprisingly, it's housing. Renters and homeowners pay a premium of 213.9% to the national average to keep roofs over their heads.
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1. Manhattan, New York
- Borough population: 1,596,273
- Median household income: $95,866
- Average home price: $2,711,000
- Premium to U.S. average: 411.5%
No place beats the center of the Big Apple when it comes to being the most expensive housing market in the U.S.
With space at a premium and location paramount, the average price of a home in Manhattan is $2,711,000, or 5.3 times higher than the national average. Heck, the average home price in Manhattan is 38.5% higher than what you find in Honolulu, and 39% greater than what San Jose has on offer.
True, the island borough's median home value comes to a somewhat less stunning $1,006,100, or $348,800 lower than San Jose. But average monthly principal and interest rate payments on mortgages stand at $14,043, which absolutely blows away every other city in the U.S. (San Jose comes in second at $8,725, while the national average is $2,455) Average rent in Manhattan comes to $5,686 a month, which is also by far and away the highest of any American city.
The bottom line? Manhattan residents spend almost five times the national average for housing.
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