It’s getting less expensive to buy a home in the Bay Area’s most expensive ZIP codes, but don’t let that fool you — it’s still going to cost more that most any other place.
That’s according to an analysis of data from Zillow Group Inc. and Bankrate LLC by The Business Journals.
Nationally, median home prices inched up by an average of 0.67% between 2022 and 2023 — emblematic of a housing market that has retreated from the lofty gains seen during and immediately after the pandemic.
Based on current median home values, interest rates and an assumed 10% down payment, it takes household income of at least $100,000 to afford a median priced home in 28% of the more than 23,921 ZIP codes we analyzed. For comparison, the national median income was $74,580 in 2022.
Here in the Bay Area, many of the ZIP codes require some of the highest incomes in the nation to afford are largely scattered around the Peninsula and South Bay, with some exceptions. Here’s a rundown of the most expensive mortgage payments and highest incomes needed to pay them based on 2023 median home values:
Atherton, San Mateo County (94027): Median home value: $7.4 million (-7% year over year), annual mortgage payment: $559,427; minimum annual income: $1.86 million
Los Altos Hills, Santa Clara County (94022): Median home value: $4.3 million (-8% year over year), annual mortgage payment: $327,413; minimum annual income: $1.09 million
Los Altos, Santa Clara County (94024): Median home value: $4.3 million (-9% year over year), annual mortgage payment: $293,275; minimum annual income: $978,251
Palo Alto, Santa Clara County (94301): Median home value: $3.82 million (-7% year over year), annual mortgage payment: $286,621; minimum annual income: $955,404
Ross, Marin County (94957): Median home value: $3.81 million (-9% year over year), annual mortgage payment: $285,900; minimum annual income: $953,000
Portola Valley, San Mateo County (94028): Median home value: $3.78 million (-8% year over year), annual mortgage payment: $283,459; minimum annual income: $944,862
Saratoga, Santa Clara County (95070): Median home value: $3.45 million (-6% year over year), annual mortgage payment: $258,909; minimum annual income: $863,029
Los Gatos, Santa Clara County (95030): Median home value: $3.21 million (-6% year over year), annual mortgage payment: $241,007; minimum annual income: $803,358
Tiburon, Marin County (94920): Median home value: $3.19 million (-6% year over year), annual mortgage payment: $239,077; minimum annual income: $796,925
Hillsborough, San Mateo County (94010): Median home value: $3.14 million (-9% year over year), annual mortgage payment: $235,792; minimum annual income: $785,973
Meanwhile, homebuyers in San Francisco’s 94129 ZIP code, which represents much of the Presidio, would have to fork over $148,702 annually for their mortgage payments on homes in that area with a median price of $1.98 million. For San Jose’s priciest ZIP code, 95129 (West San Jose near Cupertino), the median price of a house stands at $2.2 million — a $165,642 annual mortgage payment that would require an income of $552,140 or more to afford.
The national housing picture
While muted gains or declines in home prices in many ZIP codes were enough to negate rising interest rates, there were plenty of exceptions where the income it takes to buy a home soared over the past year.
Tourism hotbeds and second-home markets like Moran, Wyoming’s 83013, saw notable surges. In Moran, located near Grand Teton National Park, the income needed to afford a median home increased by 16% to $410,811. That was the largest increase of any ZIP code where the median home value topped $250,000.
East Coast tourist destinations like Chincoteague, Virginia, and Hilton Head Island, South Carolina, as well as suburbs surrounding New York City and Philadelphia also posted big gains.
Nationally, there are 14 ZIP codes where it takes at least $1 million to afford a median priced home in 2023. That’s down from 16 a year ago. Median home values dropped year-over-year in 10 of those 14 million-dollar markets for 2023.
Of the million-dollar ZIP codes, all but Aspen, Colorado’s 81656 were found along the coasts. Many were associated with metros supported by the technology sector, including Seattle suburb Medina (98039), as well as the aforementioned Bay Area enclaves Atherton (94027), Ross (94957) and Portola Valley (94028), as well as Palo Alto (94301) and San Jose/Los Altos (94024, 94022).
Conversely, the country’s least expensive ZIP codes were found in the South, the Rust Belt and Appalachia.
Three of the 10 least expensive U.S. ZIP codes were found in Youngstown, Ohio. An industrial community that has economically waxed and waned along with coal and steel industries, Youngstown has most recently attached its fortunes to the electric vehicle sector.
