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You already know California has a reputation for sky-high prices. Yet most people automatically think of San Francisco or Los Angeles when the topic of expensive cities comes up. That’s the obvious answer, right? The big urban centers with their famous skylines and celebrity sightings.
Turns out, there’s a quiet little town that’s been making headlines for all the wrong reasons when it comes to affordability. A place most Americans have never heard of, nestled in Silicon Valley, where the median home values are so outrageous they make Beverly Hills look like a bargain. Ready to hear which city actually tops the list?
Atherton Takes the Crown for Cost of Living
Atherton consistently ranks as the most expensive city in California for 2025 based on data analysis. With a cost of living index of 344, it surpasses well-known cities like Los Altos, which itself carries a hefty price tag.
This small town between Menlo Park and Redwood City isn’t exactly on every tourist’s radar. Atherton is the wealthiest city in the United States, with its ascendance stemming largely from single-family zoning, one-acre-minimum lot sizes, and streamlined permits. The real shocker? The median income in Atherton comes in at over $250,000, and the average home value is roughly $7.5 million for 2025.
Let’s be honest here, this isn’t the California dream most people imagine. There are no trendy coffee shops or boutique stores lining the streets. There is no commercial zoning in the town, thus there are no restaurants, shops or grocery stores.
San Francisco Isn’t the Winner After All
San Francisco gets all the attention when people talk about expensive California cities. Sure, it’s pricey, but the numbers tell a different story when you dig deeper.
San Francisco ranks as the nation’s most expensive metro, where it costs roughly 18 percent more than the typical US metro, with San Franciscans paying double the national norm for housing. Still, when you compare city to city rather than metro areas, Atherton beats it handily. San Francisco is often called the most expensive city in the state, though cost of living rankings reveal otherwise.
What happened? San Francisco’s reputation stuck while smaller, more exclusive communities quietly surpassed it. San Francisco continues to cool, with the city now having just one ZIP code on the most expensive list, a steep drop from 13 in 2019. The tech boom moved beyond the city limits, taking wealth into surrounding enclaves.
Beverly Hills Gets Overshadowed by Silicon Valley Wealth
When you think expensive California real estate, Beverly Hills probably comes to mind immediately. The mansions, the celebrities, Rodeo Drive. It practically screams luxury.
Beverly Hills is not the most expensive housing market in California, with Atherton in the Bay Area holding that title with a median listing price hovering around $10.8 million. Beverly Hills has added nearly $2 million to its median home value since 2010, with a net increase of over 127 percent.
Here’s the thing though. Beverly Hills has brand recognition, but Atherton has something else entirely: tech money. Atherton is the epicenter of Silicon Valley wealth. While Hollywood stars buy homes in Beverly Hills, venture capitalists and tech billionaires quietly purchase estates in Atherton. Different worlds, different price tags.
Why Atherton Commands Such Astronomical Prices
So what makes this sleepy residential town so expensive? It’s not beaches or entertainment districts or even proximity to major job centers in the traditional sense.
Located in the heart of Silicon Valley, Atherton is home to tech billionaires and venture capitalists, offering expansive estates, tree-lined streets, and unmatched privacy. Atherton is defined by acre-plus lots and zoning that limits most parcels to a single home, keeping supply tight. That scarcity drives demand through the roof.
The town attracts high-profile buyers including Warriors star Stephen Curry and Netscape co-founder Marc Andreessen, who pay for privacy, scale, and proximity to Stanford and Sand Hill Road. When the world’s wealthiest tech executives want a home base, they’re not looking at condos. They want land, privacy, and easy access to their companies. Atherton delivers all three.
The ZIP Code That Lost Its Crown
Interestingly, Atherton’s reign as the absolute most expensive ZIP code in the entire nation came to an end recently. After eight consecutive years as the country’s most expensive zip code, Atherton’s 94027 lost its leading spot as Fisher Island in Miami Beach soared ahead with $9.5 million median prices.
Still, at $8.33 million, Atherton remained the second priciest zip in the nation for 2025. That’s still wildly expensive by any measure. Despite lagging behind its previous ranking, California continued to dominate with the state making up 61 percent of the top 100 most expensive ZIP codes.
The shift to Florida signals a broader trend where ultra-wealthy individuals are exploring options beyond California’s high taxes. Yet Atherton’s position remains secure among the nation’s elite real estate markets.
What You Actually Need to Earn to Live There
Let’s talk real numbers. What kind of income do you need to afford life in these expensive California cities?
If you want to live in California’s most expensive places, you will have to make at least $127,979 per year. That’s just the baseline. For Atherton specifically, the reality is far steeper. The average city renter in expensive areas like San Jose needs to make more than $136,000 to keep their housing payments at 30 percent of their income.
Honestly, those figures feel almost quaint when you’re talking about purchasing homes valued at multiple millions. The down payment alone on a median Atherton home would exceed what many Americans earn in a decade. It’s a different universe financially.
Other Surprisingly Expensive California Towns
Atherton isn’t alone in shocking people with its price tag. Several other small California communities fly under the radar while commanding massive home values.
The most expensive cities in California include Los Altos, Hillsborough, Los Altos Hills, Woodside, Tiburon, Beverly Hills, Malibu, Saratoga, and Palo Alto. Monte Sereno, with a population under 4,000, is tucked between Los Gatos and Saratoga, offering wooded neighborhoods, luxury homes, and proximity to elite schools.
These aren’t household names. They’re quiet residential enclaves where Silicon Valley’s wealthiest professionals settled down. Demand from Silicon Valley professionals and retirees has kept the housing market strong. While tourists flock to San Francisco and Los Angeles, the real money lives in these overlooked suburbs.
The Contrast with California’s Cheapest Cities
California’s cost of living varies wildly depending on where you land. While Atherton demands millions, other parts of the state remain relatively affordable.
California’s cheapest place to live, Hanford, a Central Valley farm community, is only 1.6 percent cheaper than the national norm. Cities like Bakersfield, Fresno, Visalia, Madera, Merced, and Modesto offer homes under $350,000 with cost-of-living scores 10 to 20 percent below the national average.
The gap between California’s richest and poorest communities is staggering. You can buy an entire house in Bakersfield for what some Atherton residents spend on property taxes in a single year. That divide shapes who can afford to live where and underscores California’s ongoing housing crisis.
How Atherton Compares to Major Metro Areas
When people compare expensive cities, they usually stack up major metros like San Jose, Los Angeles, and San Diego. Atherton plays in a different league entirely.
San Jose has a median home price exceeding $1.6 million as of May 2025, continuing to lead the U.S. in high real estate costs among major metros. California continues to dominate rankings, with San Francisco, San Diego, and Los Angeles listed among the 10 most expensive major cities.
Yet small towns like Atherton still outpace these urban giants in median home values. The difference? Density and zoning. Major cities have apartments and condos that bring down median prices. Atherton has only sprawling single-family estates.
Why Most People Have Never Heard of Atherton
Part of what makes Atherton’s ranking so surprising is its relative anonymity. Most Americans couldn’t point to it on a map.
The town actively maintains its low profile. In 2022, the town blocked a proposal to build 131 multifamily housing units in response to strong criticism, with many residents including Golden State Warriors player Steph Curry strongly opposing proposals to permit more housing construction. Advocates for construction of additional homes have criticized Atherton as being a NIMBY town.
That exclusivity is by design. Residents aren’t looking for publicity or tourist dollars. They want privacy, space, and distance from the chaos of nearby cities. The lack of commercial zones and the large lot sizes ensure the town remains a well-kept secret among the ultra-wealthy.
So, did you expect Atherton to top the list? Most people assume San Francisco or Beverly Hills would take the crown. The reality is that California’s most expensive real estate exists in quiet, exclusive residential towns where tech wealth has quietly accumulated. Next time someone mentions expensive California cities, you’ll know the real answer. What surprises you most about these rankings?
Besides founding Festivaltopia, Luca is the co founder of trib, an art and fashion collectiv you find on several regional events and online. Also he is part of the management board at HORiZONTE, a group travel provider in Germany.
