Tech Execs Driving High-End Single-Family Home Buying

High-net-worth home buyers hailing from tech-driven fields like life sciences, engineering, technology, and telecommunication are shaping the luxury real estate market. And the pandemic-fueled remote-work lifestyle shift coupled with liquidating stock has motivated many buyers to seek out more space in cities such as Austin, Miami, and just outside of San Francisco in Marin County.

States like Texas without income taxes continue to become bustling tech bubbles, as companies like Planatir, Oracle, and SpaceX moved their headquarters to Austin during the pandemic. Apple is opening a US$1 billion campus in Austin, and Amazon recently expanded its footprint outside of Texas’ capital city with an 820,000-square-foot fulfillment center. Microsoft, in September, announced a new headquarters in Miami, Florida, while private-equity giant Blackstone will also be opening an office in downtown Miami with more than 200 tech employees.

Interestingly, the list of top 20 emerging housing markets for October 2021 was dominated by much smaller markets such as Elkhart County, Indiana; Raleigh, North Carolina; Colorado Springs, Colorado; Waco, Texas; and Sarasota County, Florida, with the average population size closer to 400,000, according to data from The Wall Street Journal and Realtor.com’s Emerging Housing Markets Index.

And the population continues to grow in these emerging markets. What’s more, the data show that 6.4% of movers in the top markets were from other places, with the average at just 5.9% for all 300 areas reviewed.

OUTDOOR AMENITIES, TURNKEY HOMES DRIVE BAY AREA BUYERS

A reported 17% of tech jobs listed in the San Francisco area are now remote, compared with between 2% to 3% before the pandemic. Agents in the Bay Area say high-end home buyers working in tech have left the city for more space.

“There’s a lot of new money in tech right now and a lot of IPOs. More homes have sold over US$20 million in Marin County in 2021 than ever before. People would rather be in Marin because you have the ferry, and it’s close to the water,” says Magda Sarkissian, agent, Golden Gate Sotheby’s International Realty in the San Francisco Bay Area, California.

This year, six homes sold over US$10 million in Mill Valley, California. “That’s the strongest year ever for Mill Valley,” she says.

“People’s values have changed. They want to be with their families and friends, they want room for in-laws, and space for their kids to play. They’re buying into the outdoor access to hiking, biking, and sailing culture,” she says.

As electric cars appear to be the future of the car industry, brokers say they’re also seeing charging stations become essential in high-end homes.

MORE LAND, NO INCOME TAXES

Tye Truitt, realtor, Kuper Sotheby’s International Realty in Austin, Texas, says home buyers from the “tech-odus” are typically paying in cash and purchasing outside the city center in search of more land and bang for their buck.

“While the cost of living in Austin is increasing, it is still much more affordable to the tech executives coming from the traditional tech hubs in California, New York, and elsewhere,” Truitt says. “This is especially true in the surrounding areas that are still close to the city center and are very affordable, like Leander, Texas, for example, which is located only 15 miles north of the new Apple campus in the northwest Austin tech corridor.”

“Additionally, there is no state income tax; a vibrant music and cultural scene; warm weather for most of the year; and a lot of outdoor and nature-based activities, which again, during the pandemic became even more desirable,” Truitt explains, noting that CEOs he’s worked with have cited the Lone Star State’s “business friendly” environment as a reason for moving.