Over the past 12 years, the housing market has experienced a significant swing from peak to trough and back again. According to the latest Special Report from CoreLogic, while some metros across the country are continuing to recover, others have grown impressively. Particularly, many metro areas with a strong technology industry have enjoyed strong growth.
The following metro areas were chosen based on a ranking by Cushman & Wakefield (Figure 1), which considered institutions of higher learning, investment funding, well-qualified workforce and entrepreneurship when determining the top 25 technology metro areas in the United States.
With high levels of venture capital funding, access to top university graduates and an ample supply of technology workers, the San Jose metro area – the epicenter of Silicon Valley – ranks based on both its five-year appreciation rate of 77 percent and its average year-over-year equity gain of $102,828 in the third quarter of 2017. With a strong job market and high-paid workers commuting to Silicon Valley, the? San Francisco metro area also experienced high growth rates, with a five-year appreciation rate topping 65 percent and an average annual equity gain of $73,217. West Coast hub Seattle also experienced strong growth rates with a 68 percent five-year appreciation rate and an average equity gain of $63,641.
Conversely, the average annual equity gains for homes in the Austin, Washington D.C. and Madison metro areas – $10,180, $12,539 and $9,787 – fell short of the national average of $14,888. Interestingly, only four of the 10 largest metros in the study – Washington D.C., Seattle, Austin and Denver – are considered overvalued. This indicates that despite the growth in home prices in metros like San Diego and Boston, other economic factors such as low unemployment, people choosing to rent, and access to high-paying jobs, have kept these regions within the normal range.