California housing crisis turning many working-class towns into 'million-dollar cities': Report
Once quaint California towns with working class residents are now turning into cities where homes exceeding $1 million is considered the norm, a new report says.
A growing list of California cities are reeling from the ongoing housing crisis, with once working-class towns seeing median home prices exceeding $1 million.
According to The Los Angeles Times, Placentia, Orange, Tustin, Bonita, Cerritos, and San Gabriel are all facing a substantial jump in home values. Many of the hardest-hit cities are located in Orange County, San Diego County, and Los Angeles County.
The outlet noted that Bonita and Tustin saw the most significant growth rates, with homes jumping nearly 12% in the last year.
Real estate agent Tor Black, 55, and his wife Iris have lived in Tustin for five years and purchased their "forever home" in 2022. The property has skyrocketed in valuation from $800,000 to $1.3 million (a 60% increase).
AVERAGE COST OF AN AMERICAN HOME IN THE DECADE YOU WERE BORN, FROM 1940S TO PRESENT DAY
Black said the area has very little undeveloped land, so most people who move to the city purchase older homes and use spare cash to fix them. Many homes are also passed down through families. According to Black, these two factors are increasing the price of property.
He noted that the supply and demand constraints of Southern California make the price hikes more understandable.
According to Zillow, California has 210 cities with a median home value greater than $1 million. The real estate marketplace company noted there are only 550 "million-dollar cities" in the U.S., giving California nearly 40 percent of them.
The Los Angeles Times found that California has more million-dollar cities than the next five states combined. Furthermore, California added 12 cities to the list in 2024. The state was only beat out by New Jersey, which added 14 cities.
Five cities in southern California saw home price growth ranging from 12% to 17%.
Home prices spiked by a massive 65% over the last five years in the Bonita area of San Diego County.
The median home value in 2023 across California was $789,000, up 3.1% from 2022. The median home value has jumped 33.5% over the last five years.