Home prices have skyrocketed in the past two years, fueled by low mortgage rates, the desire to move to cities outside America’s huge metros, and the mobility people have gained because they can work from home.
Some of these circumstances have changed recently, which might change homebuying patterns. Mortgage rates have risen from under 3% to over 5%. Smaller cities have become expensive because of the migration to these metros. The one thing that persists is that people can work from home permanently. People who do not want city living under any circumstances continue to view suburbs as attractive.
To determine the most expensive suburb for homebuyers, 24/7 Wall St. reviewed data compiled by StorageCafé, an online platform for storage rental listings. The site identified the top 100 suburbs for premier living, according to numerous criteria, including population density, employment opportunities, number of retail stores and restaurants, park and recreation areas and crime rates. It defines suburbs as municipalities with between 10,000 and 100,000 inhabitants located near the 100 largest metro areas for which data was available. It then consulted the Zillow home value index to determine average home values in each suburb and its nearest principal city.
Note that home value is not the same as home price. Value is the result of an appraisal of what a home is worth, while price is a measure of what a buyer is willing to pay for it. Nonetheless, value is considered a good way to estimate future prices.
The most expensive suburb for homebuyers is Palo Alto, California. The average home value there in March of 2022 was $3,846,548. Its nearby principal city is San Jose, California, where the average home value was $1,444,420.
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