The median home value is at its highest level ever, at nearly $220,000, with some of the biggest markets reporting double-digit annual home value growth. In order to better understanding how much value a homebuyer can get, though, can be difficult. Zillow Research aims to help buyers understand just how far their dollar can go with a map which shows how much a dollar can buy in each market.
On the national level, one dollar can buy 1.07 square inches of the average home, compared to 1.23 square inches a year ago, and 2.09 square inches in 1998. In San Jose, however, where home prices are 84 percent higher than they were 20 years ago, a dollar will get you just 0.20 square inches. Ten years ago, one dollar could buy you 0.37 square inches, and in 1998, it could buy close to a full square inch.
San Jose is still not the most expensive market for your buck. A dollar will only get you 0.14 square inches in San Francisco, compared to just under a full square inch 20 years ago.
A homebuyer’s dollar goes the furthest in Memphis, where it will get you 2.5 square inches of a the average home. In 1998, that dollar would get a homebuyer 3.13 square inches.
“A dollar today isn't what it used to be, particularly when it comes to real estate in light of the rapid pace of home-value appreciation that the American economy has witnessed over the past half-decade," said Zillow Senior Economist Aaron Terrazas. "A dollar gets you about 20 times more space in an affordable market like Memphis than in a pricey place like San Francisco. Figuring out exactly how much space a dollar does – or doesn't – buy you can be sobering, but enlightening. The space we live in is a tangible thing, with real value, and this shows how true that is."
Find the complete research report here.