Tag: #Ohio

As someone interested in the housing market you have to be at least a little curious about data centers and the controversy that surrounds them.

(As realtors, we’re curious, too.)

Here’s what we can tell you based on the research that we’ve done.

The Big Question: What About Home Values?

One of the first questions we all have is: does a nearby data center hurt home values? So far, there’s no evidence that says it automatically will.

Researchers compared communities that have large data centers to similar communities without them. A recent HousingWire article reports:

“. . . home values in data center ZIP codes generally tracked their matched communities — with no statistically meaningful gains or losses. Listing prices showed a modest initial increase around openings . . .”

That’s important context. Historically, simply having a data center nearby hasn’t been enough to send home values dramatically higher or lower.

That doesn’t mean every property will react the same way. Proximity, the surrounding development, and the specific facility can all matter. But for the typical homeowner or buyer, the research so far doesn’t point to an automatic impact on home values.

Living Near a Data Center Can Come with Tradeoffs

Like any major development coming to town, data centers can bring benefits along with things buyers and homeowners will want to consider.

On the plus side:

• They may be part of a bigger growth story. A data center can usher in broader development in an area and substantial property tax revenue that can be used to improve the community. 
• Infrastructure may get an upgrade. New roads, fiber, power infrastructure, and other improvements can come along with major development. 
• They can generate economic activity. A data center can generate jobs which in turn fuels local housing demand and supports local businesses. 

On the flip side:

• They’re not exactly invisible. Large facilities, transmission lines, substations, and construction can change the look and feel of an area. 
• Noise can matter. Cooling equipment, generators, construction, and truck traffic may be noticeable depending on how close you are. 
• They use more resources. These facilities can require significant electricity and, depending on the cooling system, water. That can raise questions about local infrastructure and whether growing electricity demand could affect what residents pay. 

On that last point, J.P. Blackwood, Public Affairs Liaison and Media Spokesperson for the Ohio Consumers’ Counsel (OCC), offered his take on what consumers need to know about data centers and their potential to impact utility costs to HousingWire:

“Utility rate increases tend to be gradual, and so that’s what I would expect here. Again, a number of factors can drive electricity prices higher and are driving them higher, and this is one of them. There are steps being taken around the country to mitigate the effects of data centers.”

Basically, they’re just one factor that can have an impact. And the key word there is “can” because it depends on where you live and what rules are in place in your area.

Bottom Line

If a job change is bringing you to states like Georgia, Pennsylvania, and Ohio, or you’re considering retiring to places like Arizona or Nevada, find out what’s already there – and what’s approved or proposed nearby. Consider the facility’s proximity, potential noise, future development, and whether utility costs are something you want to factor into your budget.

If you live in other parts of the country and are selling, don’t assume a nearby data center automatically hurts your home’s value. But it’s likely that buyers will have questions. Knowing the facts about the facility, construction timeline, noise, and future plans can help you address those concerns upfront.

As more data centers pop up, they’re becoming another piece of the puzzle buyers and homeowners need to understand.

So, it’s important to connect with an informed realtor in your area of interest. Through our involvement with the Tom Ferry Organization, we know highly qualified realtors across the country. If you need a referral, please let us know how we can help.

Mari, Hank, and Colleen

Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision.