{"id":41119,"date":"2024-02-26T13:00:47","date_gmt":"2024-02-26T21:00:47","guid":{"rendered":"https:\/\/www.homelight.com\/blog\/?p=41119"},"modified":"2025-10-28T12:05:00","modified_gmt":"2025-10-28T19:05:00","slug":"buyer-how-do-people-afford-million-dollar-homes","status":"publish","type":"post","link":"https:\/\/www.homelight.com\/blog\/buyer-how-do-people-afford-million-dollar-homes\/","title":{"rendered":"How Do People Afford Million Dollar Homes?"},"content":{"rendered":"

It used to be that owning a million-dollar house was a luxury dream beyond the reach of average Americans. Today, in some parts of the country, home prices have made it almost a necessary reality for those who need to live in high-cost housing markets<\/a>. But how do people afford million-dollar homes?<\/p>\n

In this guide, we provide insights into how you can unlock the door to such a significant investment. We\u2019ll look at the financial mechanics behind affording a luxury home and explore alternatives that can make your dream purchase a reality. We\u2019ll also share expert insights and interesting facts about million-dollar home markets in the U.S.<\/p>\n\n\n\n\n\n

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How Much Is Your Home Worth Now?<\/h3>\n

Home values have rapidly increased in recent years. How much is your current home worth now? Get a ballpark estimate from HomeLight’s free Home Value Estimator.<\/p>\n \n

\n Get Estimate<\/a>\n <\/div>\n <\/div>\n<\/div>\n\n\n
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How do people afford million-dollar homes?<\/h2>\n

There are a number of strategies homebuyers are employing in their quest to buy higher-end properties. Denise Madan<\/a>, a luxury home real estate agent in Florida with 25 years of experience, explains that, initially, the process mirrors a traditional home purchase, but then often requires some creative financing.<\/p>\n

\u201cTypically, a buyer is going to put 20% down, and they’re going to finance the rest \u2014 most of them do a traditional 30-year-fixed loan. However, for a [million-dollar home], they are often going to do two loans. They’re going to do a conventional loan, and then do an equity loan so that they can afford it.\u201d She adds, \u201cIf the loan amount goes over a million, like over a million four, then they would have to get a jumbo loan.\u201d<\/p>\n

Let\u2019s take a look at these common ways people can afford to purchase a million-dollar home.<\/p>\n

1. Unlock equity from your existing home<\/h3>\n

For many, the key to affording a million-dollar home lies in the equity<\/a> of their current property. Homeowners can tap into this equity through a sale or a home equity line of credit (HELOC), providing a substantial down payment for their next purchase. This approach leverages the value you’ve built in your current home to help finance a more expensive one.<\/p>\n

If you\u2019re a homeowner with significant equity in your current house, there are innovative buy before you sell programs<\/a> available from real estate companies like HomeLight<\/a> that can help you unlock your equity and purchase your new home. Here\u2019s a short video illustrating how HomeLight Buy Before You Sell works:<\/p>\n