Report finds no 'data center effect' on national housing market despite local fluctuation
The National Association of Realtors released a new report finding minimal national correlation between data center sprawl and housing growth, but highlighted significant local variations and concerns. The report noted mixed residential perceptions and positive commercial impacts, while identifying energy and water costs as primary client concerns, with electricity rates rising significantly in high-concentration data center counties. Future studies will delve into specific local impacts, such as residential buildout near communities in western Prince William County.
The National Association of Realtors (NAR) has published a new report indicating a minimal national correlation between the expansion of data centers and housing market growth in the United States. However, the report emphasizes that the impact is highly localized and clustered, with only 251 out of 3,220 counties nationwide hosting data center infrastructure.
Nadia Evangelou, a principal economist with NAR, highlighted key data center hotspots including Northern Virginia (Loudoun and Prince William counties), Silicon Valley, central Ohio, the Phoenix area, and central Washington state. Ohio has surpassed Virginia in total campus square footage. The study found that counties with high concentrations of data centers (10 or more facilities, making up only 34 counties) tend to have stronger housing markets, higher median home values, and greater employment growth compared to counties without such infrastructure.
While commercial property values and demand for commercial space saw clearly positive effects, residential perceptions were mixed. Significant concerns among clients were energy costs (61%) and water use (56%). Residential electricity rates in high-concentration data center counties rose 21.4% from 2020 to 2024, notably higher than the 15.7% increase in counties without data centers.
NAR chief economist Lawrence Yun stated that there is "no single data center effect," with outcomes varying significantly by local market. Evangelou confirmed that future studies would provide more granular tracking, particularly for specific residential buildout concerns in areas like western Prince William County. The association currently holds no formal policy stance on data centers.