Indeed, when it comes to statistics, million dollar homes are hard to find. That’s not to say that in certain towns in the nation – Alpine, New Jersey and Los Gatos, California to name a couple on opposite coasts – a $1,000,000 is the virtually the minimum price for entry.
Most Expensive Markets
Based on its Q4 2006 survey of existing homes in major metro areas, San Jose topped the list with a media price of $760,000. That's a 4.4% discount compared to the $795.000 median price of the second quarter of 2006. (Given overall trends, Q1 2007 data -- due out in mid-May -- is likely to show further depreciation in most markets.)
San Francisco ranks second and is much the same at $733.000, vs. $752,000.
In the $600,000 bracket, Anaheim-Santa Ana (Orange Co.) came in at $690,700 (down from $726,200 earlier in the year) . Honolulu, Hawaii at $620,000 ($640,000 in Q2), was the only only entry.
Three areas in the New-York-New Jersey-Pennsylvania region came led the next tier, but the extent of price declines has varied widely at $498,444 vs. 540,200,, 473,700 vs. $478,000 and $464,000 vs. $473,700.
Even with the considerable price differences from one market to the next as well as the various regions regions in the country, the idea of a million dollar home "doesn't mean the same thing, doesn't have the same pizzazz," says Stephen Melman, director of economic services at the national Association of Homebuilders.
The group doesn't track million dollar home per say. 'We define it it terms of size, not price," says Melman. The trade group does have a category of homes called "upscale", which means 4,000 square feet or more. That category is also distinguished by such non-standard amenities as outdoor kitchens and full pantries.
Still, based on Commerce Dept data, only 6% of the homes sold during 2006 were priced at $750,000 or more. The Northeast region was tops 14%. The data has no bracket for $1,000,000 or more.
Overall, new homes, which are generally pricier, had a median sales price of $254,000 in March. The average price was $330,900, vs. $26,600 in 1970 and $76,400 in 1980.
Luxury homebuilder Toll Brothers recorded 1,094 contracts for million-dollar homes last year, which was 18% of the total. In 2001, that category was a 152 homes, or 4%. In 1997, "It was under a handful" says Frederick N. Cooper, VP for finance and investor relations. The house generally run from 3,000 to 5,000 square feet.
Cooper is quick to acknowledge the inflation effect, but says the growth is the result of "a variety of things." Toll has grown dramatically as a company but it has also been "introducing more, higher-end homes."
Then take the example of Hovnanian Enterprises, a builder whose homes span the range of the market. In 2006, the company delivered 20,201 homes. The highest price was $2.2 million and the lowest was $42,000. The average was $329.000. In 2000, the top was $1.4 million, the bottom was $37,000 and the average was $257,000. Then again, in several of the recent boom years, Hovnanian didn't deliver one million-dollar home, says Jeff O'Keefe, the company's director of investor relations.
Suffice it to say, like all things real estate, it is location, location, location -- and in many markets, a million dollars still goes a long way
The bottom of NAR's metro list includes metro areas in Ohio, Indiana and Illinois -- and all under $100,000.
Melman of the realtors group takes a more practical view of the market, million dollar home or not. "The price may be higher, but you're also getting a better product."