Not surprisingly, the majority of American households do not make an annual income of $200,000 or more. As such, many cities show a significant difference between the proportion of million-dollar homes and the number of households that may be able to afford them.
This gap is highest in San Francisco, which is widely known for its unaffordable housing. Though 73% of the homes are valued at $1 million or more, less than 42% of households in the city earn $200,000 or more annually.
In an additional 16 cities, the difference between the share of million-dollar homes and the share of households that may be able to afford them exceeds 10%. Of those, only four are outside of California and Washington. They are: Boulder, Colorado; Miami Beach, Florida; Honolulu, Hawaii; and New York, New York.
Boulder's Affordability Gap
Boulder's gap between the percentage of million-dollar homes and the number of households that may be able to afford them is particularly interesting given recent increases in home values. In 2015, only 14.4% of homes were valued at $1 million or more, compared to 44.4% in 2021.
Though not everyone is currently looking to buy a home (and some homeowners may have seen a large return on investment on their previous home purchases given these increases), this bodes poorly for renters. The mismatch in affordability exceeds 27 percentage points or nearly three in 10 residents. Specifically, more than 44% of homes in Boulder are worth at least a million dollars, while less than 17% of households earn $200,000 or more annually.