Do Data Centers Lower Nearby Home Values? The Evidence Is Mixed
New research suggests data centers don't hurt property values, but homeowners living near them tell a different story.
As the artificial intelligence boom drives a nationwide surge in data center construction, homeowners near proposed or existing facilities are growing increasingly anxious about what that proximity means for their property values. Community opposition has intensified in recent months, with residents voicing concerns at zoning hearings and on social media about noise, traffic, and the industrial character these sprawling facilities can bring to residential neighborhoods.
Academic and industry research, however, paints a more reassuring picture than the anecdotal evidence suggests. Studies examining home sales near operational data centers have generally found little to no statistically significant drag on property values — a finding that challenges the gut instincts of many sellers who believe their listings are being overlooked because of a nearby facility. The disconnect between data and lived experience is telling: perception, in real estate, can shape outcomes even when hard numbers don't support the fear.
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That gap matters enormously in practice. A homeowner who believes a data center has damaged their property's value may price aggressively downward, accept lowball offers, or simply delay listing — behaviors that create real financial consequences regardless of whether the underlying concern is empirically valid. Real estate agents working in affected markets have to navigate that psychology while simultaneously reassuring buyers who may have their own reservations about living near large-scale industrial infrastructure.
The broader context here is worth noting: data centers have become one of the fastest-growing categories of commercial real estate in the United States, fueled by cloud computing demand and, more recently, the compute-intensive requirements of generative AI. That expansion is pushing these facilities into suburban and even semi-rural corridors where residents have little prior experience with industrial neighbors. As siting conflicts multiply, the question of how data centers affect surrounding communities — economically, environmentally, and socially — is likely to become a more prominent policy debate at the local and state level.
For now, sellers near data centers face an uncertain market where evidence and emotion pull in opposite directions. Continue reading at MarketWatch.com
