According to a new report from the National Association of Realtors analyzing over 3,200 counties, the housing market effects of data centers are far more complicated than most people assume. The study found that while counties hosting data centers tend to have higher home values and stronger job growth overall, that doesn't mean the facilities automatically boost or hurt property values in a predictable way. Researchers identified roughly 1,474 data centers spread across 251 counties, with Virginia's Loudoun County leading the nation, followed by Santa Clara County here in California with a significant number of facilities as well.
When the NAR surveyed real estate agents about their local experiences, the responses were pretty mixed. About a quarter of agents reported positive impacts on residential values while another quarter reported negative ones, with roughly a third admitting they weren't sure which way things were going. Interestingly, when asked about residential demand near these facilities, the sentiment leaned slightly negative, with more agents seeing decreased interest than increased interest in homes close by.
The commercial side tells a different story. Half of the agents surveyed reported positive impacts on commercial property values near data centers, and industrial properties saw the strongest demand with 58% of respondents noting increased interest. Land near these facilities also attracted significant attention from investors and developers looking to capitalize on the infrastructure boom.
The real concerns people are raising cluster around practical issues like rising electricity costs and water consumption. Energy costs topped the worry list at 61% of client concerns, followed closely by water use at 56%. Interestingly, the data backs up those worries to some extent. From 2020 to 2024, residential electricity rates grew faster in counties with heavy data center concentration than in counties without them, though the correlation wasn't perfectly consistent across all markets.
Counties with the most data centers also showed stronger economic fundamentals overall. Median household incomes in high-concentration data center counties ran substantially higher than in counties without them, and residents there were significantly more likely to hold college degrees. Employment growth over the past decade favored data center counties too, though that growth has started to cool in recent years.
What I am seeing locally here in the Bay Area and throughout the East Bay is that Santa Clara County's position as a major data center hub means we need to pay close attention to how these developments are reshaping our markets at the neighborhood level. The NAR's research really underscores what I tell my clients all the time: you can't just look at county statistics and make assumptions about your specific street or neighborhood. The impact of data centers on home values, electricity costs, and even buyer demand varies tremendously depending on your exact location, so it's critical to understand what's actually happening in your particular market rather than applying broad regional trends.
