If Wealth Was Distributed Equally in America, Could Everyone Afford a $1 Million House?

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A recent article on GOBankingRates reported that the household wealth of Americans was at $160.35 trillion, based on data compiled by the Federal Reserve. If this amount were distributed evenly, then everyone would have about $471,465 or $942,930 per couple, since there are roughly 340.11 million people.

A couple with two kids would have a combined household worth of $1.89 million. With housing prices skyrocketing in the last few years, it’s worth discussing whether homes would be more affordable if the wealth were distributed equally. 

We will review if everyone had the same amount of wealth, if they could all afford to buy and maintain a million-dollar house. 

What It Takes to Buy a Million-Dollar Home 

According to the National Association of Realtors, the median down payment for first-time homebuyers in 2024 was just 9%, much below the standard rule of 20%. You can also apply for a Federal Housing Administration (FHA) loan, which requires a minimum down payment of only 3.5%. However, there’s more to buying an expensive home than just the list price. The following are expenses you have to factor in:

• Closing costs. 
• Property taxes.
• Average maintenance costs. 
• Insurance.

Data compiled by Clever Real Estate looked into the numbers behind purchasing a million-dollar home. The research found that if you want to qualify for a mortgage on a million-dollar listing, you’ll likely need a “jumbo loan” due to the amount that you’re borrowing. You’ll also need a significant amount of money in savings, as you’ll likely have to make a 20% down payment ($200,000), and closing costs should be around $24,223.

These are the projected monthly payments on a million-dollar home with a 30-year fixed-rate mortgage at 6.99%, an annual homeowners insurance policy that’s 0.5% of the property value, annual property taxes of 1.1% of the home’s value, and $500 in monthly HOA fees.

• Mortgage payment: $5,317
• Insurance: $417
• Property taxes: $917
• HOA fees: $500
• Monthly total: $7,151

It’s worth pointing out that these figures assume a high credit score of over 700 and a 20% down payment. Numerous factors are considered when applying for a mortgage, like your debt and employment history. 

Could Everyone Afford a Million-Dollar Home?

If wealth were distributed equally, would everyone be able to afford and maintain a million-dollar property? The data compiled by Clever found that you’ll need a minimum annual income of $306,471 to maintain a million-dollar home.

Another piece on Fortune found that someone with a $250,000 yearly salary could likely afford a million-dollar home. With a monthly gross income of $20,833, this person should ensure that their housing expenses align with the 28% rule, which dictates that they shouldn’t exceed 28% of their monthly income. 

Since we don’t have information available about everyone’s income, we will use the available numbers and assume that the person is relying on their newfound net worth. 

• A single person with $471,465 would put down the $224,223 to cover the down payment and closing costs. This would leave them with $247,242, and they would have enough money to cover the monthly expenses of $7,151 for about 35 months. 
• After a couple with $942,930 spends the $224,223 on acquiring the property, they’ll be left with $718,707, which would be enough to cover the monthly expenses for 100.5 months.
• Families with $1.89 million would have $1,665,777 left after moving in. This would be enough to cover the monthly expenses for 233 months.

While these numbers don’t factor in the person’s current income, it helps to know how long someone could maintain a million-dollar property. 

Is This Amount of Inventory Even Possible in the Current Housing Market? 

If the wealth was spread evenly and nobody sold off any real estate to make it happen, here’s a look at some of the current numbers.

A report from Redfin found that 8.5% of U.S. homes in June 2024 were worth $1 million or more, marking the highest share of homes with this value. This translates to 8,022,439 homes, which would not be enough inventory. The May housing report from Realtor.com shared that the number of actively listed homes reached one million for the first time since the winter of 2019. 

“A million-dollar home in one place can be much different than another place, and the general cost of living can vary significantly, too,” said Adam Hamilton, a real estate expert and CEO of REI Hub. “Property taxes, insurance costs and even maintenance costs can be way higher or lower depending on where you live.”

He continued, “So, even if wealth was distributed equally, certain people may end up spending way more money on housing costs over time than others, depending on where they live.”

The reality of the situation is that there isn’t enough inventory for everyone to purchase a million-dollar home if wealth were distributed evenly. However, many people would finally be able to buy a home or enter the real estate market. According to recently gathered data from Fool.com, the median home sales price in the U.S. as of the first quarter of 2025 was $503,800, and the average home sales price is $503,800.

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