The U.S. currently has 218 cities that have an average home value of at least $1 million—three more than at the end of 2018 and 74 more than there were five years ago.
Zillow states the addition of three $1 million cities is the lowest in recent years.
Seven cities earned the $1 million distinctions during 2019: Santa Ynez, California; Telluride, California; Forest Hills, Tennessee; Sierra Madre, California; McLean, Virginia; Moose, Wyoming; and Redondo Beach, California.
The cities of San Jose, California; San Quentin, California; Lexington Hills, California; and Laie, Hawaii, lost their distinct of a $1 million city.
Zillow said an average of under 20 cities annually broke the $1 million threshold from 2014-2018, including a high of 25 in 2017 when home values grew 7% annually.
Eighteen cities joined the $1 million city list in 2018 and 25 in 2017.
"Odd though it may seem, it's the cities at the top that are 'struggling' the most during this return to normalcy in the market," said Skylar Olsen, Zillow's Director of Economic Research. "More than just slower growth, home values good and truly fell in many of these hubs of luxury, a sign that the excessive home value appreciation of the past several years drove prices too high—even beyond the reach of those who could afford almost anything almost anywhere else."
More than half of all $1 million cities came from Los Angeles, California (30); San Francisco (46), California; and New York (43). Other markets with the most $1 million cities were Boston, Massachusetts (10); San Jose (10), and Miami, Florida (7).
Zillow states that if current rates of appreciation remain steady in 2020, 11 cities will join the $1 million city list in 2021: Needham, Massachusetts; Longport, New Jersey; East Pasadena, California; Glen Ellen, California; Alameda; California; View Park-Windsor Hills; California; Avila Beach, California; Clayton, California; Carmel Valley, California; and Dana Point, California.
Additionally, the cities of Kailua, Hawaii; Milpitas, California; Harding Township, New Jersey; Daly City, California; and Freemont, California, will all lose their $1 million status.