A return to near normality post-Covid-19 has seen buyers return in their droves to the US property market, with inner-city capital values following a historic upward trajectory. But with unprecedented demand across the board following an impressive market recovery, what are the most expensive housing markets in the US?
According to international real estate company Savills’ recent property report, while lockdowns throughout 2020 and even into 2021 meant that buyers abandoned the city in favour of the wide, open spaces of the countryside, the re-opening of cities – from restaurants to offices – has lured those same buyers back to the metropolises.
But this isn’t to say it’s back to business as usual. The lasting impact of the pandemic in relation to the US housing market is that buyers have more freedom, with the rise of homeworking leading to cities like Miami – which boast far more space, not to mention that sought-after ocean proximity – becoming more in-demand than ever.
Find out which are the most expensive housing markets in the US below.
1. New York City – $2,580 per sq ft
Despite taking a significant Covid-19-related hit (one of the biggest in the world, in fact), New York remains the most expensive city in the US to buy property, with a prime capital value of $2,580 per sq ft following a 5% capital value growth in the latter half of 2021. Oversupply continues to heavily impact prices, with the return of entertainment venues, restaurants and offices drawing buyers back to the city.
So what is it that makes New York so expensive? In short, New York is an attractive place to live. While Washington, DC, is the country’s political capital, New York is undoubtedly the US’s cultural and financial centre, with some of the world’s most influential brands and companies calling the city home. The job market is robust and excellent schooling is plentiful, and there’s plenty for residents of all ages to do; New York’s popularity speaks for itself.
Of course, limited space also plays a key part. As a city all but surrounded by water, free ground space is hard to come by, with Manhattan desperately clinging to its green space. Space in New York City is so coveted, in fact, that developers have all but run out of ground to build on; instead, the only way to build is up, with air space being the most coveted commodity.
If you’re looking to purchase inner city, you will naturally find that the most sought-after properties are luxury condos and penthouse apartments, with buildings in the coveted Upper East Side providing stunning interior design, panoramic city and park views and uncompromised security. Alternatively, for a more townhouse-esque property, opt for an iconic New York brownstone on the outskirts of the city centre, many of which have been refurbished to a remarkably luxurious standard.
For a minimal-effort, personalised and more discrete residential offering in New York, choose a luxurious branded residence, of which the city has plenty – the concept did begin here, after all.
2. San Francisco – $1,620 per sq ft
After a steady market throughout 2020 and 2021, despite obvious difficulties, San Francisco entered 2022 in a strong position, with an average property price of $1,620 per sq ft – an increase of $80 per sq ft on this time last year – making it the second on the list of the most expensive housing markets in the US.
San Francisco’s booming property market can be attributed to many factors. Firstly, like New York, the city is an undeniably attractive place to live: its climate is appealingly described as “Mediterranean”, its culinary scene is thriving and it’s crammed full of culture and history. For many, the only downside to living in San Fran is its notorious hills.
In addition to the great quality of living, the thriving job market (which is bolstered by an impressive number of stylish tech companies) and its proximity to Silicon Valley also contributed to the ever-rising cost of San Francisco real estate. Of course, there is a little bit of a chicken and the egg scenario in San Francisco: did the high cost of living cause the rise in tech start-ups in the area, or did the booming tech industry and job market attract affluent residents? Whatever the answer, one thing’s for sure: San Francisco’s tech hub status and its wealthy inhabitants have made for one of the most expensive housing markets in the US.
In terms of residential property, San Francisco has plenty to offer, with Presidio Heights, Seacliff and Pacific Heights among the most coveted and expensive neighbourhoods.
3. Los Angeles – $1,560 per sq ft
Like the rest of the US’s most prominent cities, Los Angele’s property market is booming, with real estate averaging around $1,560 per sq ft. While the desire for open spaces isn’t quite as prominent now as it was in 2020, changing priorities have left potential buyers hankering for more privacy at home – something that LA can offer in bucketloads. Savills names “the appeal of metropolitan life in Californian cities” as another big draw.
The sprawling city is home to some of the US’s most exclusive neighbourhoods, most of which are found on the Pacific coastline or tucked away in the Santa Monica hills. In the hills, you’ll find areas such as Bel Air, Beverly Hills and Brentwood, whereas by the ocean spots such as Malibu and Venice are both popular, all of which attract a host of notable individuals and A-List celebrities.
For wealthy individuals looking to purchase in Los Angeles, space is the main appeal. While properties in New York, and even San Francisco, tend to be limited in both indoor and outdoor space, LA homes are abundant in room, with mansions being the go-to for the city’s elite. Outdoor space isn’t in short supply either, with pretty much all the larger properties boasting enormous and perfectly manicured gardens. Privacy is another key factor, with most LA homes set some distance away from their nearest neighbours.
The notorious wealth and fame of many Angelenos, and the upscale properties available as a result, are major contributors to the desirability of its housing market. The continued lack of new large-scale developments in the city is also to thank for Los Angeles’ ever-growing property market, with demand severely outstripping supply thanks to local growth control and often, opposition from local residents.
4. Miami – $1,510 per sq ft
While still sitting at the bottom of our list of the most expensive property markets in the US, Miami is undoubtedly the strongest performer in terms of housing market growth in the past year, jumping from $970 per sq ft to $1,510 – a seismic leap by all standards. This trend is showing no sign of stopping either, with Savills anticipating a further 10% increase.
Savills attributes the strength of the market to the exponential rise in hybrid working, leading more people to realise that they can live where they please, rather than where their offices are – and if this trend continues to grow, you can be sure Miami’s housing market will too. In addition to home-working opportunities, Miami’s open economy, pleasant climate and lack of state income tax are big attractions to relocators.
Types of property in the city vary greatly, with luxurious inner-city condos complete with first-class amenities and larger, detached properties in gated communities and island enclaves (such as Star Island and Indian Creek Island) all available. And for those looking to invest, Miami’s housing market is showing no signs of stopping. Its appeal is so great in fact, that out-of-this-world branded residences are cropping up left, right and centre on the city’s already impressive skyline.
This article originally appeared on Elite Traveler.