NEW YORK (CNNMoney.com) - Americans are buying homes that are bigger and contain more luxury features than ever. By some accounts, the million-dollar-plus home is now the strongest segment of many housing markets.

Pamela Liebman, CEO of The Corcoran Group, a leading real estate brokerage in New York City, Long Island, New York and Florida, says, "A lot of money is going into high-end housing. Buyers just don't want to compromise their desires."

Photo Gallery See more photos

A lot of those desires have filtered down from the luxury home market to more mundane residences. That has contributed to a jump in single-family home prices of more than 13 percent this past year. The median U.S. home now costs about $214,000, according to the National Association of Realtors.

The largest areas of million dollar homes cluster in and around big coastal cities and posh beach and mountain resort communities. Among states, California had the highest percentage of million-dollar homes the last time the Census Bureau reported; 4.1 percent of all Golden State homes were worth a million or more at the end of 2003.

That was almost double the percentage of four years earlier. As housing continued to boom throughout 2004 and much of 2005, the number of million dollar homes in California has, undoubtedly, climbed considerably.

Other centers of high million dollar home ratios as of December 31, 2003 include Connecticut (3.3 percent), the District of Columbia (3.2 percent), and Massachusetts (2.2 percent).

Low million-dollar home areas were concentrated in the prairie states and the South. North Dakota had the lowest incidence, less than 0.01 percent, followed by Iowa (0.04 percent), and Arkansas (0.08 percent).

What buyers get for a million dollars varies greatly. In expensive Santa Monica, it might only buy a two bedroom teardown on a vest-pocket lot. In much more reasonable Dallas, on the other hand, it could buy a 5,000 square foot mini-estate with six bedrooms, five baths, in-ground pool and spa.

Americans practically everywhere continue to make their homes bigger and better. Harvard's Joint Center for Housing Studies reported in January that we spent nearly $150 billion, a new record, on home improvement in 2005. That was up 4.3 percent from 2004.

Low mortgage rates fueled the home renovation mania, according to the Joint Center report. Many homeowners refinanced their loan when mortgage rates cratered and some owners took out extra cash to pay for home improvements.

Mortgage rates have been on a slow upward trajectory lately however, which could lead to fewer cash outs and home renovations, as well as a dampening effect on home prices. It would seem that the factors that have led to a big increase in the number of million-dollar homes will be lessening.

That trend may have already begun; median home prices in the second half of 2005 grew much more slowly than the first half.

The forecast for 2006 home prices from the National Association of Realtors calls for much more modest increases, more in the mid-single-digit range.

Even that will be enough to send some properties over the edge into million-dollar status.

____________________

More real estate stories:

• The mega trend toward monster condos.
• Best places to live: see the winners.
• Re-doing your home? Look at the hot new trends in home design.