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These Are the Most (and Least) Expensive U.S. Neighborhoods to Buy a Home, According to a New Report

The list compared 22,000 neighborhoods in cities across the nation.

<p>DianeBentleyRaymond/Getty Images</p>

DianeBentleyRaymond/Getty Images

The old real estate adage “location, location, location” rings true today more than ever. While the type of property and its amenities certainly determine the price of a home, the city and neighborhood it is in are even more important. So, where are the most expensive homes located in the country? A new report by American Home Shield compared listing prices and home size data in over 22,000 neighborhoods on Homes.com, ranking them by price per square foot.

Somewhat unsurprisingly, given recent news reports, the top three places are occupied by communities in California, followed by Washington, Florida, and New York. The undisputed winner is San Francisco’s South of Market (SoMa) neighborhood, where the average price per square foot was $5,415 in December 2023. SoMa is home to some of the city’s finest cultural institutions, the Oracle Park baseball stadium, high-end hotels, and Michelin-starred restaurants.

Second on the list is Northwest Auburn, about 30 miles northeast of Sacramento, where the average per-square-foot price is $4,416. And the bronze medal goes to the quaint beachside community of Old Town Carpinteria in Santa Barbara County, where prices per square foot reach $4,129. Also in the report’s top 10 are two neighborhoods in Naples, Florida (Aqualane Shores and Port Royal) and two in New York City (the West Village and the Upper East Side’s Metropolitan Hill).

“There is wide variation in home prices across the country, with bargains to be had in some places and others like San Francisco that are extremely expensive. The dynamics caused by COVID-19, like low interest rates and a shift in how people lived and worked, caused a massive spike in real estate prices. With very low inventory and high interest rates, it makes it difficult for people to buy [a home],” Jessica Fields, VP of sales, and chief sales officer at Frontdoor, American Home Shield’s parent company, said.

If you’re looking for affordable housing, though, consider Pittsburgh’s Homewood North neighborhood, where the average price per square foot is just $29. Three areas share the second spot for the cheapest neighborhood, and they are Jackson’s West Jackson in Mississippi; Gary’s Downtown in Indiana; and Flint’s Metawanee Hills in Michigan, where the price is $32 per square foot. Some other least expensive neighborhoods that made it to the top 10 are in Indiana, Ohio, and Missouri.

However, if you dream of owning a home in some of the expensive areas, there is some good news.

“As we look to the future of real estate, we’re starting to see some positive trends. Mortgage rates are starting to stabilize, and sellers are gaining confidence in putting their homes on the market, which will lead to more opportunities for buyers to purchase homes in 2024,” Fields added.

You can read the full report and see the most expensive neighborhood in your state on ahs.com.

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