The 5 most expensive cities in America for buying a home

Prospective homeowners in the five most expensive towns in the United States need to earn at least $1 million annually to afford to buy property, according to a recent report released by GOBankingRates.

The analysis looked at the 50 wealthiest towns in the US and determined the minimum salary needed to own a home in each town, assuming that buyers were spending no more than the recommended 30% of their salaries on housing.

This report comes following a year in which many Americans continued to face obstacles in buying homes. In June 2024, the median sale price for existing properties hit an all-time high. At the same time, the average age of American homebuyers rose by six years — to a historic high of 56, according to the National Association of Realtors’ (NAR) 2024 Profile of Homebuyers and Sellers.

“First-time buyers face high home prices, high mortgage interest rates and limited inventory, making them a decade older with significantly higher incomes than previous generations of buyers,” Jessica Lautz, NAR deputy chief economist and vice president of research, said in a statement.

Some experts anticipate that the housing market will remain skewed toward sellers in 2025, though many questions remain – particularly with the changing economic policies of a new presidential administration.

“Mortgage rates won’t fall enough [in 2025] to spur an increase in existing-home inventory, with most of the increase in inventory seen in the market coming from new construction,” said Greg McBride, CFA, Bankrate’s chief financial analyst, in a statement.

“Most areas will still lean toward a seller’s market due to limited inventory. However, those markets that have seen a surge in inventory will definitely be more of a buyer’s market and will be susceptible to price declines.”

Continue reading to see how much it costs to buy a home in the five most expensive markets in the United States.

5. Hillsborough, California

Average household income: $539,950

2024 typical home value: $5,099,160

Salary needed to afford a house: $1,015,321

4. Montecito, California

Average household income: $327,332

2024 typical home value: $5,423,239

Salary needed to afford a house: $1,079,851

3. Los Altos Hills, California

Average household income: $460,098

2024 typical home value: $5,631,372

Salary needed to afford a house: $1,121,293

2. Atherton, California

Average household income: $594,651

2024 typical home value: $7,424,850

Salary needed to afford a house: $1,478,402

1. Palm Beach, Florida

Average household income: $365,991

2024 typical home value: $11,592,915

Salary needed to afford a house: $2,308,328