The US cities with the most million-dollar homes are all major tech hubs, and it points to a darker side effect of the rise of big tech
Category : entrepreneur
- A new study found that San Jose, San Francisco, and Seattle are among the top-five metro areas with the largest proportion of million-dollar homes in the US.
- These cities are home to tech companies including Facebook, Amazon, and Apple, among others.
- Major tech headquarters can put a strain on an area’s resources — San Francisco is in the middle of a housing crisis, and homelessness is a major issue in the Bay Area.
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A new survey from online loan marketplace LendingTree shows a connection between technology hubs and high housing prices.
By comparing the proportion of million-dollar homes in the 50 largest US metro areas, the study found that the Bay Area took the top two spots, with San Jose on top followed by San Francisco. Seattle, home to Amazon and Microsoft, was No. 5, the highest entry outside of California.
Not every city on the list can point to tech for high housing prices, but the prominence of the Bay Area and Seattle point to the potential downsides tech companies can bring to an area.
San Francisco has been the poster child for a city whose resources are pushed to the limit by tech companies that call it home. It’s the most expensive city for homebuyers in the United States, and over 40% of housing units are priced over $1 million. The median price for a single-family home has increased over 300% since 2000. People making six figures can even be considered “low income” due to extreme costs of living. The city also has a severe shortage of affordable housing, and one of the worst homelessness crises in the US.
Facebook CEO Mark Zuckerberg nodded to some of these problems in an October Q&A, saying that Facebook is primarily expanding outside of San Francisco because the city’s infrastructure is “tapped.” He did not reference ways in which tech companies might have contributed to that problem.
Amazon’s canceled HQ2 plans for New York City show that some people are seeing this dark side effect of tech, and trying to prevent it from coming to their cities. Critics pointed out that while Amazon would receive more than $3 billion in tax incentives, vital infrastructure used by people of all income levels, like the subway, was in need of repair. Amazon cited “local opposition” as the reason for cancellation.
In recent months, Apple and Facebook have each committed billions toward affordable housing in San Francisco. Google has already pledged $1 billion to the Mountain View area, and Microsoft gave $500 million for Seattle housing. Despite the large sums of money, some critics say this won’t be enough, especially with more planned IPOs in 2020 that could add even more millionaires to the Bay Area.