By Meghan Hall
The West Coast has become an increasingly expensive place to live over the years, and high home prices that once seemed to be found only in places like San Francisco and Los Angeles have now impacted other markets such as Seattle and the Puget Sound. A recent report released by PropertyShark, a subsidiary of Yardi Matrix, shows that the vast majority of the nation’s priciest zip codes are located in high-profile markets along the West Coast.
PropertyShark calculated median home sales prices as opposed to asking prices to paint a more accurate picture of the national market. With a shortage of housing and demand for for-sale product on the rise as a result of COVID-19, it is not a surprise that many markets are experiencing vertical price trends, according to PropertyShark’s latest report. “Vital” urban centers and markets that are considered economic powerhouses–notably the Bay Area, Los Angeles and Seattle–have a heavy presence in this year’s report.
California continues to have the majority of the country’s most expensive zip codes, contributing a hefty 70 percent of the priciest markets on PropertyShark’s list, including six of the top 10 priciest. The number one most expensive zip code in the United States, Atherton, Calif., is located in San Mateo County, not far from San Francisco. This year, the market set a new record as the median sales price hit $7.475 million.
San Francisco, specifically, also recorded the highest concentration of expensive zip codes for the 5th consecutive year; with seven neighborhoods ranking among the nation’s top 100. Prices for homes within these zip codes, which include locations like the Marina District,ranged from $1.63 million to $2.3 million. Overall, the Bay Area had 47 of the nation’s priciest zip codes, including three of the top 10 zips.
“California all around has a strong and diverse economy and is home to the biggest hubs for the entertainment and tech industry, two of the most significant and visible U.S. [sectors] globally,” explained PropertyShark’s Eliza Theiss. “Add to that the strength of [California’s] economic growth (which was north of 30 percent in the post-2008 decade) and its continued appeal for young professionals who continue to flock to the Golden State. The real estate industry itself is a major driver of the economy – even when it comes to industrial real estate, California is one of the hottest markets.”
However, it is Los Angeles County who remained the priciest overall, with 21 zip codes topping the list. The famed zip code of 90210, which has been consistently ranked as one of the most expensive in the country, saw a median sale price of $4.124 million over the course of the past year. Neighborhoods like the Pacific Palisades posted median sales prices of $3.25 million, an 18 percent year-over-year increase. Neighborhoods like Bel Air and Beverly Glenn saw median sales prices hit $2.46 million.
Orange County contributed another nine zip codes to the list. Newport Beach had the third-highest concentration of pricey zip codes. There, the median home price sat at $3.577 million.
PropertyShark notes that while anecdotally the Bay Area is well known for its high cost of living, Southern California’s concentration of expensive real estate is not to be underestimated.
“It’s more a question of comparing apples to oranges. The Bay Area is indeed the most expensive metro area in the U.S., but none of the nine counties that makeup the Bay Area can (at least for now) rival the concentration of expensive zip codes that can be seen in Los Angeles County,” said Theiss. “The latter’s closest rival is the Bay Area’s San Mateo County, but even San Mateo had 15 of the top zips compared to LA County’s 21. Similarly, whereas San Francisco had the highest concentration of pricey zips in any city with 7 of the 100 priciest, Los Angeles claimed six.”
Theiss added, “We usually avoid speculations and only provide data-driven outlooks, but barring any major unexpected shifts or events, California’s economy will continue to outperform all other U.S. states. As for real estate prices, the same logic applies, compounded by the state’s growing housing shortage.”
California, however, is not the only West Coast state with pricey real estate. !,000 miles to the north, in the Pacific Northwest, Seattle and the greater metropolitan area of King County has experienced rapid growth, leading to a rise in housing prices. Medina, just outside of Seattle, reached its highest pricing point ever, with the median home price hitting $4 million. Pricing is the result of a 24 percent year-over-year increase. Other neighborhoods, like Mercer Island, are also listed as some of the nation’s priciest. There, homes typically sell for around $1.795 million.
These neighborhoods have become favorites of high-profile sports figures, media personalities and tech executives, according to PropertyShark. While King County was listed as the 82nd most expensive metro in the nation after making its debut in 2019, that growth is expected to continue due to economic fundamentals bolstered by the growth of major tech firms such as Amazon and the region’s bustling life sciences industry.