Real Estate Market Archives

Will the Commercial Real Estate Market Crash in 2023?

May 15, 2023 by Marco Santarelli

The commercial real estate market is currently facing a looming crisis that experts predict could surpass the challenges experienced during the 2008 financial downturn. Analysts at Morgan Stanley have raised concerns about the industry, citing recent loan defaults by prominent office landlords and a decline in demand for office spaces as warning signs.

Additionally, with a significant number of commercial mortgages due for refinancing in the coming years, the situation is becoming increasingly precarious. In this article, we will explore the various factors contributing to the potential crisis and examine whether a commercial real estate market crash is likely in 2023.

Banking Turmoil Looms

The Chief Investment Officer of Morgan Stanley, Lisa Shalett, has issued a warning regarding the commercial real estate lending rates. Even if interest rates remain stable, new lending rates for commercial real estate (CRE) are expected to be considerably higher than existing mortgage rates. This prediction has the potential to impact a significant number of banks, with an estimated 190 facing challenges similar to those experienced by Silicon Valley Bank. Small- and medium-sized banks, which make up a substantial portion of CRE lending, are particularly vulnerable in this situation.

Decreasing Demand and Vacant Offices

Even before the collapse of Silicon Valley Bank and Signature Bank, the commercial real estate market was already grappling with multiple challenges. The rise of remote work has led to a decrease in demand for office spaces, which has been further exacerbated by escalating maintenance costs and interest rates. According to Morgan Stanley analysts, there is a potential for a decline in commercial property prices by up to 40%, which would rival the magnitude of the 2008 financial crisis.

Segments of Resilience and Vulnerability

The commercial real estate sector encompasses a wide range of assets, including office buildings, shopping centers, multifamily apartments, hotels, and data centers. However, not all segments face the same vulnerabilities. Data centers and industrial buildings that support e-commerce have shown relative resilience. On the other hand, the office space sector remains a major concern, undergoing a transformative shift that presents significant challenges.

Private Equity as a Potential Solution

To address the potential crisis, Mark Grinis, EY Americas Real Estate, Hospitality & Construction leader, suggests that poorly structured and capitalized buildings may change ownership or face foreclosure in the near future. However, when market conditions are favorable, private equity is expected to step in. With increasing public interest in office stocks due to their perceived value, private capital is likely to invest when the timing is optimal. Such an influx of capital could help stabilize the market.

Insights from Real Estate Firms

Real estate firms are already observing the impact of stricter lending requirements on their business. Kip Sowden, CEO of RREAF Holdings, a private real estate investment firm, anticipates a significant reduction in deal volume due to higher interest rates and limited funding from financial institutions. Lending criteria have become more stringent, necessitating increased equity for transactions. This contraction in business further highlights the challenges faced by the commercial real estate market.

Exploring Office-to-Residential Conversions

One potential solution to address the struggles faced by the office sector is the conversion of these spaces into residential properties. The shift to remote work during the pandemic has left many office buildings vacant. Experts suggest expediting zoning changes required for office-to-residential conversions, which could address the problem of underutilized properties and contribute to resolving the shortage of affordable housing. Collaboration between state and local officials, private capital, regulators, and legislators is crucial to ensuring the continued vibrancy of cities.

Signs of Trouble in the Commercial Real Estate Market:

Rising Vacancy Rates: Key markets like Manhattan and Silicon Valley are experiencing record-high vacancy rates in commercial real estate properties. This indicates a challenge in finding new tenants as old leases expire, and it puts downward pressure on rental prices and property values.
Refinancing Cliff: The commercial real estate market is facing a significant refinancing challenge in the coming years. Many commercial mortgages are due for refinancing, and with higher interest rates and increased vacancies, property owners may struggle to secure favorable refinancing terms. This could lead to defaults and financial instability in the market.

The Potential Impact on the Economy:

Credit Squeeze: Goldman Sachs has warned that a potential credit squeeze in the commercial real estate market could have broader implications for the overall economy. It could result in a slowdown in lending, reduced business investment, and a negative impact on economic growth.
Tax Base Concerns: Empty offices and commercial properties can have a detrimental effect on the tax base of municipalities. With reduced property values and lower tax revenues, local governments may face budgetary challenges and struggle to fund essential services.

Reasons to Believe the Commercial Real Estate Market Crisis Can Be Contained:

Diversification of Commercial Real Estate: While the office sector is facing significant challenges, other segments of commercial real estate, such as industrial, retail, and hotels, are performing relatively well. The diversity of assets in the commercial real estate market provides a buffer against potential risks, as the struggles in one segment can be offset by the strength of others.
Manageable Refinancing: Despite the refinancing cliff, a considerable portion of commercial real estate debt appears capable of being refinanced without major issues. Banks have maintained strict lending standards, and most debt in the market generates sufficient income to meet these standards. This indicates a certain level of stability and preparedness in the industry.
Strong Credit Performance: Banks have reported excellent credit performance in commercial real estate lending, with low delinquency rates and minimal losses. This suggests that lenders have been cautious in their underwriting practices and have managed risk effectively. The overall health of the commercial real estate market's credit performance indicates a level of resilience in the face of potential challenges.

Worries from Wall Street:

Potential Loan Defaults: Analysts express concerns about a substantial number of office loans defaulting, which could result in significant losses for banks. However, the severity of potential value declines and project failures remains uncertain. It is crucial to closely monitor these risks and implement measures to mitigate potential fallout.
Market Softness in Refinancings: The refinancing processes in the commercial real estate market are already showing signs of softness. Declining bond values backed by commercial mortgages raise questions about rating agencies' views on commercial mortgage-backed securities. This underscores the need for careful assessment and risk management in the market.

Conclusion:

While the commercial real estate market is facing challenges and there are signs of potential trouble, a full-blown crash in 2023 is not guaranteed. The market's resilience, diversification of assets, and strong credit performance provide reasons to believe that the crisis can be contained. However, it is essential for stakeholders, including banks, real estate firms, and policymakers, to closely monitor the situation, take necessary precautions, and consider innovative solutions like office-to-residential conversions to mitigate risks and ensure the long-term stability of the commercial real estate market.

References:

https://www.cnbc.com/2023/04/09/the-coming-commercial-real-estate-crash-that-may-never-happen.html
https://www.usatoday.com/story/money/personalfinance/real-estate/2023/04/07/commercial-real-estate-price-drop-morgan-stanley-report/11620997002/

Turnkey Homes for Sale Are Selling Fast in 2023

May 4, 2023 by Marco Santarelli

In 2023, despite a cooling housing market and high mortgage rates, turnkey homes are in demand and selling fast. While fixer-uppers, homes with less curb appeal, and those located in less desirable areas are sitting on the market for longer, turnkey homes in good school districts remain hot commodities. In this article, we'll examine a report published by Realtor.com on why turnkey homes for sale are still in demand and explore the reasons why some homes sell quickly while others sit unsold.

Why Turnkey Homes for Sale are Selling Fast in 2023?

During the pandemic, homebuyers had limited choices, and everything sold for more money than ever before. Buyers who couldn't afford to buy a fixer-upper were left with few choices but to buy a well-appointed, well-situated turnkey home. This trend has continued into 2023, with homebuyers still seeking out these properties.

A good home in the resale market is selling quickly, and buyers today are not the same as those who bought 12 months ago. With prices still much higher than they were pre-pandemic, buyers don't have much room in their budgets for costly repairs, and they want a home that is move-in ready.

Competition for Turnkey Homes Remains Fierce

Competition for turnkey homes in good school districts remains fierce. If the house is perfect, the odds of someone else wanting it are high, too. In a market where costs are still high and buyers can be a little choosier, it makes sense that they're going to zero in on the homes that are the most appealing. Turnkey homes are especially popular with families looking for a home in a good school district. They want a home that is move-in ready and won't require any work or upgrades.

Why Fixer-Uppers Are Less Appealing to Buyers

While fixer-uppers have traditionally been popular with investors who could get these homes at a discount and resell them at a profit, this trend has slowed down in 2023. With home prices falling from their peaks over the summer, many investors are now pausing their purchases.

Fixer-uppers are staying on the market longer, and sellers are having to drop the price on these homes or accept lowball offers. Buyers want these homes only when there is no other inventory out there. Anything that is staying on the market for more than 48 hours without a booked showing is in a less desirable location and definitely not in tip-top, showable condition. Buyers are always looking for improvements that have already been done.

Location Matters

While properties that need major renovation and updates, like a new kitchen or bathroom and major systems, are not selling well, these problems can be overlooked if the home is in a great location. Homes located near a train station or in a community with top-rated schools are still desirable, and buyers could get a discount on these properties.

Price Matters

Even the ugliest, run-down, abandoned homes with the worst smells, located in the most undesirable areas, such as on a busy highway, will still sell if the price is right. Price will always overcome any objections buyers may have about the property.

How Should First-Time Homebuyers Buy/Bid for Turnkey Homes?

In today's housing market, first-time homebuyers are facing tough competition, especially those seeking a move-in ready home in a desirable community with high mortgage rates. The market has changed since the COVID-19 pandemic era, but turnkey homes in great locations continue to receive multiple offers and sell for a premium. According to Realtor.com, you need to have some strategies that can help you be competitive in the current housing market and secure your dream home.

Strategy 1: Know Your Local Market

To be successful in buying your dream home, you need to focus on your local market rather than what's happening in the national housing market. It's essential to research how long homes, including turnkey ones, are staying on the market in the specific community you're interested in. Analyzing the comps of comparable homes that have sold can also help you make an informed decision. Your real estate agent can advise you on whether you need to waive contingencies and kick in a high down payment to have your offer accepted.

Strategy 2: Get Pre-Approved for a Mortgage

Getting pre-approved for a mortgage can give you a competitive edge in the housing market. It helps you narrow down your price range and avoid losing your dream home to another pre-approved buyer.

Strategy 3: Find a Trustworthy Real Estate Agent

Your real estate agent will guide you through the home-buying process, so it's essential to find someone you trust to help you make the largest purchase of your life. Ask for recommendations from friends, check online reviews, and ensure they have experience working with buyers in a similar price range and the areas you're interested in.

Strategy 4: Make a Larger Down Payment

Sellers favor buyers who can make larger down payments as they believe they are more financially stable and more likely to complete the sale. Putting down at least 20% can increase your chances of winning a bidding war and eliminate the need to pay private mortgage insurance every month.

Strategy 5: Offer Compelling Terms

Bidding wars aren't only won on price; terms also matter. By offering a flexible closing timeline and allowing the sellers to rent back the home or vacate the property at their pace, you may have a better chance of winning the bid. You could also waive a traditional home inspection and opt for an evaluation of the structural and engineering components of the home, showing the seller that you don't plan to back out unless there are significant issues with the property.

Should You Investors Buy Turnkey Homes in 2023?

Investing in turnkey homes can be profitable in 2023 due to high demand and low inventory. Buyers seek move-in-ready properties, especially in good school districts. Fixer-uppers are less appealing, and location and price remain crucial factors. Consider investing in turnkey homes for a potentially lucrative return on investment.

When considering investing in turnkey homes, it's important to keep in mind that these properties can be a profitable investment for the right buyer. Turnkey homes can provide a reliable source of rental income, as they are often in desirable areas and require little to no renovation or repair work.

Additionally, turnkey homes tend to attract long-term tenants, as renters are often looking for a property that is move-in ready and requires little upkeep. However, investing in turnkey homes also comes with some risks. Buyers should thoroughly research the market and the specific property before making a purchase.

They should also be prepared for unexpected expenses, such as maintenance and repairs, that may arise over time. In the end, whether or not to invest in turnkey homes depends on the individual buyer's financial situation, investment goals, and risk tolerance. With careful research and planning, investing in turnkey homes can be a profitable venture in 2023.

Conclusion

Turnkey homes for sale are still in demand in 2023, despite a cooling housing market and high mortgage rates. While fixer-uppers and homes with less curb appeal are sitting on the market longer, turnkey homes in good school districts are selling quickly. Buyers want a home that is move-in ready and won't require any work or upgrades.

Location and price still matter, and homes in great locations and those that are priced right will always be in demand. Buying a move-in ready home in a desirable community in the current housing market requires first-time homebuyers to be competitive. By following the above strategies, you can increase your chances of securing your dream turnkey home.

If you're ready to start your search for a hot turnkey home in a great community, we can help. Our team specializes in finding the perfect home for every buyer, and we're here to guide you through the home-buying process. Contact us today to learn more about our current listings and start your journey toward homeownership or real estate investment.

Source:

https://www.realtor.com/news/trends/a-tale-of-2-housing-markets-why-some-homes-still-cause-heated-bidding-wars-while-others-sit-unsold/
https://www.realtor.com/advice/buy/on-the-house-if-the-housing-market-is-down-why-do-bidding-wars-and-offers-over-the-list-price-abound/

Goldman Sachs Housing Market Forecast: Will it Crash?

April 24, 2023 by Marco Santarelli

The housing market in the United States has been a rollercoaster ride in recent years, with unpredictable shifts that have left homeowners and buyers alike uncertain about what to expect. The latest forecast from Goldman Sachs is no exception, predicting a significant decline in home prices in some of the biggest cities in the country.

According to a recent note to clients, Goldman Sachs analysts predict that by the end of 2024, home prices will plunge by 19% in Austin, 16% in Phoenix, 15% in San Francisco, and 12% in Seattle. The reason for this sharp decline in home prices is due to an oversupply of housing in these metropolitan areas, which has overwhelmed demand.

“While overall levels of housing inventory remain tighter than pre-pandemic levels, some vulnerable metropolitan areas have seen supply increase rapidly. Unsurprisingly, our home price appreciation forecasts have been most negative for geographies where supply is starting to overwhelm demand,” wrote Lotfi Karoui, Vinay Viswanathan, and Ronnie Walker, the authors of the note.

The report has sparked concern among homeowners in these areas, who are understandably worried about what the future holds for their investments. However, the analysts at Goldman Sachs emphasize that the anticipated decline in housing prices in these metropolitan areas is not reflective of a broader trend in the housing market.

In particular, the analysts note that San Francisco and Austin are home to major tech firms, including Amazon, Apple, Google, and Facebook, that has been at the forefront of industry-wide layoffs. The oversupply of housing in these areas is primarily due to local challenges, including poor levels of affordability, pandemic-related distortions, and a high concentration of employment in the technology industry.

The report from Goldman Sachs is not the first to predict a decline in the housing market. In an earlier note, the bank suggested that home prices nationwide could fall around 6% from their peak before bottoming out sometime in the next six months as a result of higher mortgage rates.

“The sharpest declines for the U.S. housing market are now behind us,” the strategists, led by Goldman chief economist Jan Hatzius, said in the January note.

The housing market has been sensitive to changes in interest rates, and the Federal Reserve's aggressive campaign to tighten policy and slow the economy has had a significant impact. Policymakers have already lifted the benchmark federal funds rate eight consecutive times and have signaled their intention to continue raising rates higher this year as they try to crush inflation that is still running abnormally high.

Mortgage rates have fallen from their peak of 7.08% in November but have recently reversed that trend and started to march higher amid interest rate-hike fears. The average rate for a 30-year fixed mortgage climbed to 6.65% this week, according to data from mortgage lender Freddie Mac.

That remains significantly higher than just one year ago when rates hovered around 3.76%. This rise in mortgage rates has contributed to the decline in the housing market, as it makes buying a home less affordable for many Americans.

Despite the concerns raised by the report from Goldman Sachs, other economists have predicted even steeper declines in the housing market. Ian Shepherdson, the chief economist at Pantheon Macroeconomics, warned that home prices could tumble as much as 20% from their peak.

It's clear that the housing market is in a state of flux, with many different factors contributing to the uncertainty. However, there are also some positive signs on the horizon that may help to stabilize the market in the coming years.

For example, the Biden administration has proposed a $15,000 tax credit for first-time homebuyers, which could make it easier for many Americans to afford a home. This proposal is part of a broader plan to tackle the affordable housing crisis in the United States, which has become a major issue in recent years.

In addition to the proposed tax credit, the administration has also unveiled plans to invest $318 billion in affordable housing over the next ten years. This investment will help to create new affordable housing units, rehabilitate existing units, and provide rental assistance to families in need.

These initiatives could help to boost demand for housing in some of the metropolitan areas that are currently oversupplied. However, it's important to note that the impact of these policies will take time to be felt in the housing market. In the short term, the market is likely to remain volatile, with unpredictable shifts in supply and demand.

Another factor that could impact the housing market in the coming years is the ongoing COVID-19 pandemic. The pandemic has had a major impact on the economy, with millions of Americans losing their jobs and struggling to make ends meet. Many homeowners have been forced to sell their homes or face foreclosure as a result.

However, the rollout of vaccines and the easing of restrictions in many parts of the country could help to boost the economy and stabilize the housing market. If the pandemic is brought under control and the economy begins to recover, we could see an increase in demand for housing in many parts of the country.

Ultimately, the housing market is a complex and constantly evolving ecosystem that is influenced by a wide range of factors. While the latest forecast from Goldman Sachs may be concerning for homeowners in some metropolitan areas, it's important to remember that this is just one prediction among many.

Other economists have predicted different outcomes for the housing market, and it's impossible to know for sure what the future holds. However, by staying informed about the latest trends and developments in the market, homeowners and buyers can make informed decisions about their investments and take steps to protect themselves against potential risks.

In conclusion, the housing market in the United States is currently in a state of flux, with unpredictable shifts in supply and demand. The latest forecast from Goldman Sachs predicts a significant decline in home prices in some of the biggest cities in the country, due to an oversupply of housing that has overwhelmed demand.

However, this is just one prediction among many, and it's important to consider a wide range of factors when assessing the state of the housing market. Initiatives like the proposed tax credit for first-time homebuyers and the investment in affordable housing could help to boost demand in some areas, while the ongoing COVID-19 pandemic could continue to impact the market in unpredictable ways.

By staying informed about the latest trends and developments in the market, homeowners and buyers can make informed decisions about their investments and take steps to protect themselves against potential risks.

More Insight on the Global & US Housing Market Forecast

According to Goldman Sachs Research, higher mortgage rates are causing housing markets around the world to slow down. After a surge in housing activity during the pandemic, home sales have pulled back sharply in the second half of 2022 due to the spike in mortgage rates enacted by central banks in most developed market economies. This contraction in housing starts, sales, and prices has persisted in 2023 and is expected to continue throughout the year.

The report suggests that the impact of higher borrowing costs for homebuyers has yet to be fully felt and that the global housing market may not have reached its bottom. The GS Research team estimates that each 100-basis-point rise in mortgage rates leads to a 6% decline in residential fixed investment after three or four quarters and a 2.5% drop in house prices after 10 quarters.

The timing of the impact varies across countries due to differences in mortgage markets. Countries with higher shares of fixed-rate mortgages tend to experience delayed rate impacts. Since mortgage rates have only recently peaked in most countries and could be headed higher still, the global housing market may not have found its bottom yet.

The report predicts significant peak-to-trough home price declines in developed markets where housing affordability plunged following the pandemic, including New Zealand (-19%), Canada (-19%), Sweden (-17%), and Australia (-15%). Developed markets that will likely see flat or moderate declines include Italy (-2% peak to trough), France (-4%), and Switzerland (-6%), reflecting a slower increase in mortgage rates and “less stretched” affordability.

The US housing market is expected to see “relatively tame” home price declines of around 5%, owing mainly to its extremely low vacancy rate.

Overall, the authors of the report believe that the housing declines around the globe are going “according to plan.” The strong housing market response to rate hikes has helped slow overall growth below trend without causing a recession or triggering a rise in delinquencies in most major economies. They anticipate that this pattern will continue.

Country	Peak-to-Trough Home Price Decline
United States	-5%
New Zealand	-19%
Canada	-19%
Sweden	-17%
Australia	-15%
Switzerland	-6%
France	-4%
Italy	-2%

References/Sources:

https://www.goldmansachs.com/insights/pages/why-the-global-housing-market-has-further-to-slide.html
https://www.foxbusiness.com/economy/home-prices-could-face-double-digit-drop-cities-goldman-sachs-warns
https://news.yahoo.com/these-four-cities-could-see-double-digit-home-price-drops-goldman-sachs-204112309.html

Most Expensive Housing Markets in the US 2023

April 13, 2023 by Marco Santarelli

The United States has a diverse housing market with varying prices depending on the state and region. For homebuyers, it's important to be aware of the most expensive states to buy a house. In this article, we will explore the top 10 most expensive states for home values, according to the Zillow Home Value Index in 2023.

Top 10 Most Expensive States to Buy a House in the US

The United States has a diverse and dynamic housing market, with varying prices depending on the state and region. The top 10 most expensive states for home values, according to the Zillow Home Value Index, include Hawaii, California, the District of Columbia, Washington, Massachusetts, Colorado, Utah, Oregon, New Jersey, and Idaho.

These states offer a range of attractions for homebuyers, from natural beauty and outdoor recreation opportunities to strong job markets and quality of life. However, they also come with higher price tags, making it important for homebuyers to carefully consider their options and budget before making a purchase.

1. Hawaii

Hawaii is known for its beautiful beaches, warm climate, and breathtaking scenery. However, it is also the most expensive state to buy a house, with a Zillow Home Value Index of $834,582. The high cost of living and limited space on the islands are contributing factors to the high home values.

2. California

California is home to some of the most desirable cities in the United States, such as Los Angeles, San Francisco, and San Diego. With a Zillow Home Value Index of $728,133, it is the second most expensive state to buy a house. The state's booming tech industry, warm climate, and stunning coastline are major attractions for homebuyers.

3. District of Columbia

The District of Columbia, also known as Washington D.C., is the capital of the United States and a hub for political activity. With a Zillow Home Value Index of $627,158, it is the third most expensive state to buy a house. The city's diverse neighborhoods, historical landmarks, and thriving job market contribute to the high home values.

4. Washington

Washington state is home to major tech companies such as Amazon and Microsoft, as well as stunning natural scenery. With a Zillow Home Value Index of $562,936, it is the fourth most expensive state to buy a house. The state's strong job market, quality of life, and outdoor recreation opportunities are major draws for homebuyers.

5. Massachusetts

Massachusetts is a state rich in history, culture, and education. With a Zillow Home Value Index of $558,312, it is the fifth most expensive state to buy a house. The state's high quality of life, world-renowned universities, and strong job market contribute to the high home values.

6. Colorado

Colorado is known for its stunning Rocky Mountains, outdoor recreation opportunities, and booming tech industry. With a Zillow Home Value Index of $539,639, it is the sixth most expensive state to buy a house. The state's strong economy, natural beauty, and quality of life are major attractions for homebuyers.

7. Utah

Utah is a state with stunning national parks, a strong job market, and a growing tech industry. With a Zillow Home Value Index of $506,072, it is the seventh most expensive state to buy a house. The state's natural beauty, quality of life, and outdoor recreation opportunities are major draws for homebuyers.

8. Oregon

Oregon is known for its stunning coastline, outdoor recreation opportunities, and quality of life. With a Zillow Home Value Index of $485,474, it is the eighth most expensive state to buy a house. The state's strong economy, natural beauty, and welcoming communities are major attractions for homebuyers.

9. New Jersey

New Jersey is a state with a rich history, diverse population, and strong economy. With a Zillow Home Value Index of $451,558, it is the ninth most expensive state to buy a house. The state's proximity to major cities such as New York City and Philadelphia, as well as its strong job market and quality of life, contribute to the high home values.

10. Idaho

Idaho is a state with stunning natural beauty, outdoor recreation opportunities, and a growing tech industry. With a Zillow Home Value Index of $435,373, it is the tenth most expensive state to buy a house. The state's strong economy, low cost of living compared to other states on this list, and quality of life are major draws for homebuyers.

Top 10 Most Expensive Counties to Buy a House in the US

In addition to the most expensive states for home values, the United States also has counties that boast some of the highest home prices in the country. In this article, we will explore the top 10 most expensive counties to buy a house in the US, according to the Zillow Home Value Index.

1. Nantucket County, Massachusetts

Nantucket County, located in Massachusetts, has a Zillow Home Value Index of $2,545,939, making it the most expensive county to buy a house in the United States. This scenic island off the coast of Cape Cod is a popular vacation spot known for its historic architecture, beaches, and charming small-town vibe.

2. Pitkin County, Colorado

Pitkin County, located in Colorado, is home to the world-famous ski resort town of Aspen. With a Zillow Home Value Index of $2,003,223, it is the second most expensive county to buy a house in the United States. The county's natural beauty, world-class skiing, and luxury amenities attract affluent homebuyers from around the world.

3. Teton County, Wyoming

Teton County, located in Wyoming, is home to the stunning Grand Teton National Park and the upscale ski resort town of Jackson Hole. With a Zillow Home Value Index of $1,644,961, it is the third most expensive county to buy a house in the United States. The county's natural beauty, outdoor recreation opportunities, and low tax rates are major attractions for wealthy homebuyers.

4. San Mateo County, California

San Mateo County, located in California, is part of the San Francisco Bay Area and is home to major tech companies such as Facebook and Oracle. With a Zillow Home Value Index of $1,497,976, it is the fourth most expensive county to buy a house in the United States. The county's strong job market, mild climate, and proximity to San Francisco make it a desirable location for affluent homebuyers.

5. Santa Clara County, California

Santa Clara County, also located in California's Bay Area, is home to Silicon Valley and major tech companies such as Apple and Google. With a Zillow Home Value Index of $1,462,347, it is the fifth most expensive county to buy a house in the United States. The county's thriving tech industry, diverse population, and excellent schools attract affluent homebuyers from around the world.

6. Marin County, California

Marin County, located just across the Golden Gate Bridge from San Francisco, is known for its natural beauty, charming small towns, and affluent residents. With a Zillow Home Value Index of $1,416,752, it is the sixth most expensive county to buy a house in the United States. The county's proximity to San Francisco, mild climate, and outdoor recreation opportunities make it a desirable location for wealthy homebuyers.

7. Dukes County, Massachusetts

Dukes County, located in Massachusetts, is comprised of the island towns of Martha's Vineyard and Gosnold. With a Zillow Home Value Index of $1,378,540, it is the seventh most expensive county to buy a house in the United States. The county's scenic beauty, historic charm, and relaxed way of life are major attractions for affluent homebuyers.

8. San Miguel County, Colorado

San Miguel County, located in Colorado, is home to the picturesque mountain towns of Telluride and Mountain Village. With a Zillow Home Value Index of $1,356,052, it is the eighth most expensive county to buy a house in the United States. The county's world-class skiing, stunning mountain scenery, and outdoor recreation opportunities make it a popular destination for wealthy homebuyers.

9. San Francisco County, California

San Francisco County, located in northern California, is known for its vibrant cultural scene, diverse neighborhoods, and iconic landmarks such as the Golden Gate Bridge. With a Zillow Home Value Index of $1,277,114, it is the ninth most expensive county to buy a house in the United States. The county's strong job market, thriving tech industry, and urban amenities make it a desirable location for affluent homebuyers.

10. New York County, New York

New York County, commonly known as Manhattan, is the most densely populated borough of New York City and is known for its iconic skyscrapers, world-class museums, and diverse neighborhoods. With a Zillow Home Value Index of $1,146,577, it is the tenth most expensive county to buy a house in the United States. The county's status as a global hub for finance, culture, and entertainment makes it a highly desirable location for wealthy homebuyers.