In more than 200 U.S. cities, the typical starter home for sale is worth $1 million or higher. The cost of homes has skyrocketed during the pandemic, due to housing shortage, heightened demand and increasing inflation. A new report from Zillow found that the typical starter home in some markets is way above what the average American afford.

A starter home is in the lowest third of home values in a given region, according to Zillow.

Five years ago, there were only 84 cities where the typical starter home was valued at $1 million. Between 2019 and 2024, starter home values increased 54.1% - contributing to the delay of first home purchases for many young Americans.

Change is on the horizon for prospective first time homeowners: There is an increasing number of homes on the market, giving buyers more time to weigh their options. Rising home inventory can also help give buyers more negotiating power.

“The share of inventory of smaller and more affordable homes has grown, which helps hold down the median price even as per-square-foot prices grow further,” said Realtor.com’s chief economist Danielle Hale. “Some much-welcomed news for prospective buyers.”

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The typical starter home is worth $196,611. The real estate company called this price, "Comfortably affordable for a median-income household."

California to Texas:A move from California to Texas could save a million dollars. Many Americans are opting in.

About half of cities with $1 million starter homes are in California

Of the 237 cities with starter homes worth $1 million, half are located in California. New York has 31 cities with pricey starter homes, followed by New Jersey (21 cities).

Between 2019 and 2024, the number of cities in California with million dollar starter homes more than doubled.

Zillow said that the markets associated with lower homeownership rates tend to have the more pricey starter homes. The same goes for markets with restrictive building regulations. Lower inventory is reflected in pricier housing markets.

California has one of the most pricey housing markets in U.S.

Last year, the California Community Poll found that 4 in 10 Californians were considering moving out of state, with the majority saying it’s too expensive to live there. Although the poll found a majority of Californians love living in the state, increasing costs of living is the main driver for people moving.

About 64% of counties in the Golden State have median homes values above the national median of $389,800. Four of the top five most expensive U.S. counties by median housing price were located in California.

County level data of housing statistics from the the American Community Survey shows how much homes are valued at across California.

Cost of living:Nearly half of California residents are considering leaving the state,

Outside of California, Massachusetts rounds out the top five counties with the highest median home prices:

1. Santa Clara County, CA: $1,583,130
2. San Mateo County, CA: $1,573,470
3. Marin County, CA: $1,454,450
4. San Francisco County, CA: $1,332,660
5. Nantucket County, MA: $1,313,450

Logan Mohtashami, lead analyst for HousingWire, a trade publication for mortgage, real estate, and housing professionals previously told USA TODAY that California has been ineffective in lowering the cost of living because not enough homes are being built. That means there is more demand for homes than supply. 

Mohtashami called the housing market unhealthy, " We still have too many people chasing too few homes” he said. “California is going to be a tug of war. Can they keep enough people here? Or do more people just keep moving away?” 

Contributing: Medora Lee, Itzel Luna, USA TODAY