The issue is, in these areas, there isn't much choice. Here in DC, couples max out their mortgage because prices in any area with a good school district and less than an hour commute are exorbitant. And we're not talking luxury houses here. A 1,200 square foot 3BR in Bethesda that was last renovated in the 1950s will run you $600k.

In the DC area this results in a weird trend. There are almost no 3 bedrooms in Georgetown below a million. That'll buy you about 1,200 square feet. $2 million will buy you an actual urban mansion with triple the square footage and wood paneled walls. The price is entirely driven by what ~$300k HHI couples can "afford" maxing out their mortgage eligibility. Once you get above that, demand drops precipitously.