Four of the top five areas of the U.S. that will get a housing-market boost from tech growth are in the areas of the Midwest known as Silicon Prairie, according to a realtor.com report.
“Silicon Valley and Seattle might seem like the obvious places for tech start-ups to set up shop and large companies to site new offices, but a confluence of factors such as rampant home-price growth and a seeming saturation of companies competing for the same limited pool of tech talent have led some companies to look toward other options,” the report said.
The report ranked the “most ripe for tech growth” of the U.S. based on factors such as housing affordability, strong local economies, a ready pool of tech workers, commute times, and a more elusive factor the study called “hotness,” defined as: “Does the market have the ability attract people?”
No. 1 on the list was Oklahoma City, followed by Kansas City in the No. 2 spot.
“The Oklahoma City and Kansas City metros both score well for affordability – where typical-income earners are spending a relatively smaller share of their income on housing – livability, and the availability of a tech-skilled workforce,” the report said.
The No. 3 spot was outside the Midwest, in Jacksonville, Florida. The report described the area on the coast of the Atlantic Ocean, near the Georgia border, as “poised for growth and an influx of people.”
For No. 4 and 5, it was back to the Midwest, with Indianapolis, Indiana, and Cincinnati, Ohio, ranking next.
“What we found are – while not necessarily places that would be top of mind when thinking of tech markets – cities with untapped potential for tech companies to grow,” the report said.
San Francisco and Los Angeles ranked at the bottom, according to the report.
“Traditional tech hotspots often fell toward the bottom of the list because of eroding affordability and quality of life,” the report said. “Los Angeles and the Bay Area have the worst affordability rankings of all markets examined in this study. Chicago — not typically thought of as a tech hub — also was at the near the bottom of the 42-market ranking.”