Zillow Counts Record 242 U.S. Cities Where a Starter Home Costs $1 Million or More

A starter home is supposed to be the cheap one. In 242 American cities, it costs at least $1 million.

That is the count in a Zillow report published in June. It is a record, up from 226 a year earlier and triple the 80 cities that cleared the mark before the pandemic.

How Zillow counts a starter home

Zillow defines a starter home as a property in the bottom third of prices in a given region. It is not a luxury category or a hand-picked sample. It is the low end of the local market.

As of June, Zillow put the typical U.S. starter home at $198,649, up 1.7% from a year earlier. In the 200-plus million-dollar cities, prices in that segment run about five times the national figure.

Where the prices are

California still has the most such cities, with 105. The Northeast is where the list is growing fastest.

New Jersey had one million-dollar starter city before the pandemic. It now has 26. New York went from 12 to 41. Together the two states added 15 cities in the past year, more than any other part of the country.

The New York City metro area leads all metros with 63 cities at that level. San Francisco follows with 37, Los Angeles with 33, San Jose with 13, and Miami and Seattle with eight each.

The map has also spread. Before 2020, nearly all of these cities were on the coasts, with Colorado the lone exception. Now at least one exists in 26 states, up from nine. Texas, Wyoming and Illinois have examples.

Zillow's explanation

Zillow's own economists point to supply. "A housing shortage a decade in the making ran headlong into intense demand with mortgage rates at historic lows, driving up home values at a record pace," Zillow senior economist Kara Ng wrote.

Zillow's 2026 analysis found six of the 10 most competitive housing markets in the country are in the Northeast. That is a region where new construction has lagged and inventory deficits run deepest.

The pandemic-era rate cuts that fed demand are over. The shortage Ng describes is still on the ground.

First-time buyers are older and scarcer

The buyer side of the ledger looks just as bad. The National Association of Realtors reported in November 2025 that the typical first-time buyer reached a record age of 40. NAR data also show the share of first-time buyers has fallen to half the historical norm.

Christopher Naghibi, executive vice president and chief operating officer at First Foundation Bank, described the effect in 2024, when Zillow released an earlier million-dollar-city count. The prevalence of such cities, he said, "strains what is already the worst housing affordability since at least the 1980s." Buyers in those markets, he said, face "needing ridiculously large down payments and higher incomes to afford homes."

His comment predates this year's record. The count has since risen by 16 cities from last year's 226.

What the numbers do and do not show

The figures describe cities, not the whole country. Most of the U.S. is nowhere near $1 million for an entry-level house, and the national starter figure of $198,649 reflects that.

The cities that have crossed the line, though, include some of the largest job and population centers in the country. For a buyer in the New York metro, a fraction of one price tier is not the problem. The entire bottom third of the market is.

No source here quantifies how many homes would be needed to close the shortage Zillow cites. Nor does any lay out a plan to build them in the Northeast, where Zillow says construction has lagged longest. The next Zillow update will show whether the 242 figure holds or climbs again, and whether New York and New Jersey keep adding cities at a pace of 15 a year.