How Data Centers Affect Residential Property Values and Utilities in 2026
According to a new report titled “2026 Data Center Impact” released by the National Association of Realtors (NAR), the rapid expansion of data centers across the United States has not yet produced a single, definitive effect on local housing markets. Despite national debates surrounding artificial intelligence and massive warehouse development, the direct influence of these facilities on nearby residential real estate remains largely inconclusive.
The report highlights that data centers are geographically concentrated: 92% of U.S. counties host no facilities, while just 1% hold ten or more. Northern Virginia represents the largest hub, containing 19% of mapped data centers, followed by Silicon Valley and central Ohio at 5% each, and Phoenix and central Washington at 4% each. NAR Chief Economist Lawrence Yun noted that county-level analysis reveals no evidence of weaker housing markets in areas with a heavy data center presence, though local impacts vary significantly by neighborhood.
Counties with ten or more data centers report significantly higher median home values ($431,750) than those without any ($174,500). However, the report cautions against attributing these high home prices directly to data centers. These hubs generally existed in affluent markets with established job growth and elevated property values prior to construction, illustrating that correlation does not mean causation.
Anecdotal survey findings from 2,357 real estate agents reflected mixed observations: 25% noted a positive impact on nearby home values, 22% perceived a negative effect, and one-third were unsure. Commercial real estate showed clearer gains, with 50% of agents reporting higher commercial property values and 42% noting higher demand for commercial space.
Client concerns frequently align with “not in my backyard” (NIMBY) sentiments. Top anxieties include energy costs (61%), water consumption (56%), environmental contamination (43%), and changes to the local landscape (32%). Data support energy concerns, as residential electricity rates in counties with ten or more data centers rose 21.4% between 2020 and 2024, compared to 15.7% in counties without facilities.
While municipal budgets in South Bay cities profit from significant commercial tax revenues generated by data centers, local residents face a dual challenge of rising utility costs and intense land competition. As NAR Chief Economist Lawrence Yun noted, broad market data cannot fully predict hyper-local impacts, making parcel-by-parcel planning the real battleground for Silicon Valley’s housing future. NAR maintains no official policy stance on data centers and plans to continue assessing their market impact.
Source: National Association of REALTORS®. (2026, September 9). There’s no single “data center effect” on housing markets, NAR report finds [Press release]. https://www.nar.realtor/newsroom/theres-no-single-data-center-effect-on-housing-markets-nar-report-finds