Markets
Mapped: The Top 30 Most Valuable Real Estate Cities in the U.S.
The Most Valuable Real Estate Cities in America
According to real estate tycoon Harold Samuel, there are three things that matter when it comes to real estate value—location, location, and location.
America’s property market is no exception to this rule. Depending on the city and its—you guessed it—location, there are vast discrepancies in real estate value across the country.
Using the latest data from LendingTree, this graphic ranks the top 30 most valuable real estate cities in America. We’ll also evaluate the top cities based on median value of homes, and how COVID-19 has impacted the market.
The Most Valuable Real Estate Cities
Out of the $32.6 trillion of total real estate value included in LendingTree’s database, the top 30 cities account for almost 57%:
Rank | City | State | Total Value (in billions) |
---|---|---|---|
1 | New York | New York | $2,838 |
2 | Los Angeles | California | $2,289 |
3 | San Francisco | California | $1,320 |
4 | Chicago | Illinois | $906 |
5 | Washington, D.C. | -- | $826 |
6 | Boston | Massachusetts | $815 |
7 | Miami | Florida | $774 |
8 | Seattle | Washington | $700 |
9 | Dallas | Texas | $628 |
10 | Philadelphia | Pennsylvania | $577 |
11 | San Jose, Calif. | California | $568 |
12 | San Diego | California | $564 |
13 | Houston | Texas | $535 |
14 | Atlanta | Georgia | $531 |
15 | Riverside, Calif. | California | $485 |
16 | Phoenix | Arizona | $484 |
17 | Denver | Colorado | $439 |
18 | Minneapolis | Minnesota | $383 |
19 | Detroit | Michigan | $348 |
20 | Portland, Ore. | Oregon | $319 |
21 | Sacramento, Calif. | California | $318 |
22 | Baltimore | Maryland | $301 |
23 | Tampa, Fla. | Florida | $286 |
24 | Austin, Texas | Texas | $248 |
25 | Charlotte, N.C | North Carolina | $248 |
26 | Orlando, Fla. | Florida | $233 |
27 | Honolulu | Hawaii | $219 |
28 | Nashville, Tenn. | Tennessee | $209 |
29 | St. Louis | Missouri | $202 |
30 | Las Vegas | Nevada | $191 |
New York has the highest real estate value in the country at $2.8 trillion—that’s around the size of the UK’s GDP in 2019. Close behind is Los Angeles at $2.3 trillion, while San Francisco ranks third at $1.3 trillion.
This may not come as a surprise, considering the popularity of these areas. New York and Los Angeles have the two highest city populations in the U.S., and San Francisco is the second most densely populated city in America (after New York). Historically, these areas have been notorious for their red-hot real estate markets, limited housing supply, and high costs of living.
However, while these cities take the top three spots when it comes to total real estate value, the ranking looks a bit different when comparing the median value of each city.
Most Valuable Cities, by Median Home Value
When it comes to median home value, San Jose claims the top spot at $1.1 million, while San Francisco places second at $959K:
Rank | City | State | Median Value of a Home |
---|---|---|---|
1 | San Jose | California | $1,100,000 |
2 | San Francisco | California | $959,000 |
3 | Honolulu | Hawaii | $705,000 |
4 | Los Angeles | California | $668,000 |
5 | San Diego | California | $594,000 |
6 | Oxnard | California | $586,000 |
7 | New York | New York | $501,000 |
8 | Boston | Massachusetts | $498,000 |
9 | Seattle | Washington | $498,000 |
10 | Washington, D.C. | -- | $455,000 |
11 | Denver | Colorado | $430,000 |
12 | Sacramento | California | $410,000 |
13 | Bridgeport | Connecticut | $410,000 |
14 | Portland | Oregon | $401,000 |
15 | Riverside | California | $365,000 |
16 | Naples | Florida | $329,000 |
17 | Austin | Texas | $323,000 |
18 | Salt Lake City | Utah | $312,000 |
19 | Providence | Rhode Island | $300,000 |
20 | Miami | Florida | $297,000 |
21 | Minneapolis | Minnesota | $294,000 |
22 | Baltimore | Maryland | $284,000 |
23 | Las Vegas | Nevada | $278,000 |
24 | Phoenix | Arizona | $276,000 |
25 | Raleigh | North Carolina | $271,000 |
26 | Nashville | Tennessee | $265,000 |
27 | Philadelphia | Pennsylvania | $246,000 |
28 | Chicago | Illinois | $245,000 |
29 | Orlando | Florida | $245,000 |
30 | North Port | Florida | $244,000 |
The Bay Area leads the pack in terms of median value, but San Francisco and San Jose aren’t the only Californian cities to make the list. In fact, half of the top 10 cities are in the Golden State.
Suburban Shuffle
It’s important to note that these numbers are from January 2020, before the global pandemic triggered numerous societal and economic changes, including an accelerated migration to the suburbs from key urban centers like New York and San Francisco.
This mass exodus has negatively impacted sales activity. In fall 2020, or example, home sales in New York dropped by 50% compared to last year.
In contrast, places like Honolulu have seen significant growth in home sales—in September 2020, single-family home sales rose by 12.7% compared to last year. Some experts believe COVID has been a key factor driving this growth, as more people are able to work from anywhere, thanks to remote work.
Markets
Beyond Big Names: The Case for Small- and Mid-Cap Stocks
Small- and mid-cap stocks have historically outperformed large caps. What are the opportunities and risks to consider?
Beyond Big Names: The Case for Small- and Mid-Cap Stocks
Over the last 35 years, small- and mid-cap stocks have outperformed large caps, making them an attractive choice for investors.
According to data from Yahoo Finance, from February 1989 to February 2024, large-cap stocks returned +1,664% versus +2,062% for small caps and +3,176% for mid caps. Â
This graphic, sponsored by New York Life Investments, explores their return potential along with the risks to consider.
Higher Historical Returns
If you made a $100 investment in baskets of small-, mid-, and large-cap stocks in February 1989, what would each grouping be worth today?
Small Caps | Mid Caps | Large Caps | |
---|---|---|---|
Starting value (February 1989) | $100 | $100 | $100 |
Ending value (February 2024) | $2,162 | $3,276 | $1,764 |
Source: Yahoo Finance (2024). Small caps, mid caps, and large caps are represented by the S&P 600, S&P 400, and S&P 500 respectively.
Mid caps delivered the strongest performance since 1989, generating 86% more than large caps.
This superior historical track record is likely the result of the unique position mid-cap companies find themselves in. Mid-cap firms have generally successfully navigated early stage growth and are typically well-funded relative to small caps. And yet they are more dynamic and nimble than large-cap companies, allowing them to respond quicker to the market cycle.
Small caps also outperformed over this timeframe. They earned 23% more than large caps.Â
Higher Volatility
However, higher historical returns of small- and mid-cap stocks came with increased risk. They both endured greater volatility than large caps.Â
Small Caps | Mid Caps | Large Caps | |
---|---|---|---|
Total Volatility | 18.9% | 17.4% | 14.8% |
Source: Yahoo Finance (2024). Small caps, mid caps, and large caps are represented by the S&P 600, S&P 400, and S&P 500 respectively.
Small-cap companies are typically earlier in their life cycle and tend to have thinner financial cushions to withstand periods of loss relative to large caps. As a result, they are usually the most volatile group followed by mid caps. Large-cap companies, as more mature and established players, exhibit the most stability in their stock prices.
Investing in small caps and mid caps requires a higher risk tolerance to withstand their price swings. For investors with longer time horizons who are capable of enduring higher risk, current market pricing strengthens the case for stocks of smaller companies.
Attractive Valuations
Large-cap stocks have historically high valuations, with their forward price-to-earnings ratio (P/E ratio) trading above their 10-year average, according to analysis conducted by FactSet.
Conversely, the forward P/E ratios of small- and mid-cap stocks seem to be presenting a compelling entry point.Â
Small Caps/Large Caps | Mid Caps/Large Caps | |
---|---|---|
Relative Forward P/E Ratios | 0.71 | 0.75 |
Discount | 29% | 25% |
Source: Yardeni Research (2024). Small caps, mid caps, and large caps are represented by the S&P 600, S&P 400, and S&P 500 respectively.
Looking at both groups’ relative forward P/E ratios (small-cap P/E ratio divided by large-cap P/E ratio, and mid-cap P/E ratio divided by large-cap P/E ratio), small and mid caps are trading at their steepest discounts versus large caps since the early 2000s.
Discovering Small- and Mid-Cap Stocks
Growth-oriented investors looking to add equity exposure could consider incorporating small and mid caps into their portfolios.
With superior historical returns and relatively attractive valuations, small- and mid-cap stocks present a compelling opportunity for investors capable of tolerating greater volatility.
Explore more insights from New York Life Investments
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