The median price of a two-bedroom home in San Francisco is $1.02 million, according to the real estate site Trulia. The median for New York City homes: $1.2 million.
Nationwide, just 2 percent of homes fetch prices that large.
Jumbos are a necessity for nearly everyone in communities such as La Jolla, Calif. That's where Aniqa Jaswal and her husband in February bought a four-bedroom house about 10 minutes from the beach.
"There are no homes below jumbo mortgage prices here," Jaswal said.
The trend coincides with the lopsided nature of the U.S. economy's nearly 5-year-old recovery. Almost all the U.S. incomes gains from 2009 to 2012 flowed to the top 1 percent of earners, according to tax data analyzed by economist Emmanuel Saez at the University of California, Berkeley.
By contrast, median household income was $51,017 in 2012, $4,600 below its peak in 2007, according to the Census Bureau. Squeezed by scant pay raises, the middle class has struggled or hesitated to take on mortgage debt. Many recall the high-risk loans that ignited the housing meltdown and led to the financial crisis and recession.
Not even jumbo borrowers feel completely safe. Some are borrowing in anticipation of setbacks in an economy where bills can multiply even when incomes barely budge.
One is Stephanie Kellen, who in December refinanced her home in Marin County, Calif., with a jumbo. The lower-than-usual jumbo rate helped replace a line of credit for her husband's auto repair business.
"The best way to have security was to have low interest rate loans for as long as possible," Kellen said.
Nearly one in five homeowners still owe more on their mortgage than their homes are worth. Without home equity, they have little or no wealth even as richer Americans have benefited from rising prices for stocks and upper-end real estate.
At the same time, the government has reduced its support for middle class homeownership after having rescued two companies, Fannie Mae and Freddie Mac, that enabled lower rates. The housing bust devastated Fannie and Freddie, which guarantee conventional mortgage payments. Both were forced into federal control at taxpayer cost.
To limit taxpayer exposure, Fannie's and Freddie's regulator required them to raise fees for guaranteeing mortgages. Those fee increases have boosted conventional mortgage rates and likely blunted the effectiveness of the Federal Reserve's efforts to keep rates low to invigorate the housing market and the economy.
"We're cutting off the avenue that has the most proven success in wealth building," said David Min, a professor at the University of California, Irvine, who specializes in mortgage finance.
The higher fees have left the industry concerned that more people won't be able to afford to buy, said Bob Walters, chief economist at Quicken Loans, though the fees might help protect some people from assuming unaffordable debt.
Walters doubts that rates for traditional mortgages will ever again fall meaningfully below jumbo rates.
"I don't see the days of those microscopic guarantee fees coming back," he said.