For many buyers and investors, $500,000 is a benchmark budget. However, in today’s housing market, those numbers don’t grow the same everywhere. And the trade-offs reveal a lot about both affordable prices and investor opportunities for buyers. In cities like San Francisco and Los Angeles, $500,000 will only grow to condominiums and small starter homes, while in markets like Boston and Seattle, buyers will gain significant space on the same budget.
These differences are not only important for home buyers, but also shape how investors think about where their money is placed. Comparing the amount of homes that buy $500,000 in major US cities can reveal not only affordable trends, but also where there are opportunities for long-term real estate growth.
What determines how far $500K goes?
$500,000 may sound like a big budget, but location ultimately determines purchasing power. Some metros have $500,000 free up family homes with room for growth. Others barely cover the starter unit.
For home buyers, these factors determine what kind of space they can offer. For investors, they highlight the difference between affordable prices and admission costs across the market.
Key factors affecting the $500,000 range include:
Cost of living and demand: In high-cost metros like San Francisco and New York, limited land and intense demand means higher prices on the same budget and less space. Price per square foot: A city with a low housing cost will convert into a larger home for $500,000. In contrast, expensive coastal markets quickly eat area. Stock Level: If the number of homes for sale is low, competition will increase prices and narrow buyer options. Meanwhile, expanding inventory will allow you to grow your dollars even further. Local Economy and Jobs: A strong job market attracts new residents, raises demand for housing, boosts prices and reduces affordability. Neighborhood Factors: School quality, public transport and access to amenities can have a major impact on purchasing $500,000, even within the same metro.
With these dynamics in mind, here is the $500,000 purchases in the major US metros today.
Amount of homes to buy $500,000 in major US cities
Here’s a $500,000 purchase volume for five major metros using Redfin Data Center housing data in July 2025:
Metro SQFT $500K Median $/square-foot Selling Price Home Type 500K San Francisco, CA 500 $1,000 $1,510,000 Compact Condo or Studio Los Angeles, CA 826 $605 $926,000 Condo or Bungalow Style Starter Home Seattle, Washington 1,046 $478 $849,388 1,042 $480 $807,000 1-2 Bedroom Condo Boston, Massachusetts 1,160 $431 $775,000 Large Condo or Discreet Single-family Home
In San Francisco, $500,000 covers only about 500 square feet. In Boston, the same budget buys over 1,100 square feet, which is enough for detached houses and spacious condominiums. Cities like Los Angeles and New York are somewhere in between, with $500,000 growing from just 800 to 1,000 square feet.
What does this mean for investors?
To understand what these differences mean for investors, we spoke with Dave Meyer, Head of Content Strategy at BiggerPockets, a leading online community and resource hub for real estate investors.
“As more markets move to a buyer market where prices are flat or falling, investors are presented with both opportunities and risk.
Investors should keep an eye on the opportunity to acquire strong assets in a fundamentally strong market. Of particular interest are strong markets, such as Seattle, Dallas and San Diego, which have a very high chance of long-term growth, but are softer in prices and improving purchase terms.
Of course, as prices ease or fall in many markets, investors need to protect themselves and be aware that they will “catch a falling knife.” The best way to protect this is to aim to buy below the price and below the current comp. Investors always want to buy for value, but the 99% sales ratio nationwide indicates that after years of intense competition, buyers have returned to the driver’s seat when they negotiate prices. ”
Important takeaways for home buyers
For buyers, the biggest lesson is that $500,000 doesn’t mean the same everywhere. Some metros are enough to secure a spacious detached house, while others barely cover starter condos. Therefore, it is extremely important to look beyond the price tag alone.
Here are some takeaways for home buyers:
Size and location trade-off: Larger homes in low-cost cities may sound attractive, but if your work, family, or lifestyle connects you to a more expensive metro, you may need to compromise with square footage. Affordable prices exceed sales prices. Property taxes, insurance and HOA fees vary widely from city to city and can have a significant impact on your budget. Long-term value issues: Even if $500,000 buys less space in a high-cost market, those homes may appreciate faster and add long-term value to your purchase. Consider emerging markets. City with increased inventory and moderate priced prices could offer both affordable prices today and a solid appreciation for the future.
FAQ: How much home will you buy for $500,000?
Why do purchasing power differ so widely across cities?
Local housing needs, price per square foot, stock levels and cost of living all play a role. A strong job market and limited supply lead to higher prices and reduced $500,000 purchases.
Is $500,000 a good budget for real estate investors?
Yes, but it depends on your strategy. In some cities, $500,000 has been able to fund rental condominiums in high demand markets, while others can purchase larger properties with strong long-term valuation possibilities.
What should buyers and investors consider before spending $500,000?
Beyond the area, look at the trends of property taxes, ongoing costs and long-term appreciation. Locations determine not only what you can buy today, but how much your future investments will grow.
