The Urban Land Institute’s annual look at the year ahead cited Austin, Texas, as the top U.S. real estate market for 2020.
“Austin is number one, rising from sixth place a year ago to first in overall real estate prospects and from fourth to first place in local expectation of investor demand in 2020,” according to the Emerging Trends in Real Estate report issued by ULI and PwC on Thursday. “Our analysis considered many salient features: Its slogan (“Keep Austin Weird”), deep pool of talent, unique and popular lifestyle, and ambitious commitment to business and real estate expansion.”
The 107-page report also noted Austin’s negatives:
“Traffic is an ongoing issue,” the report said. “Housing affordability pressures are rising. These could be exacerbated since Austin has the highest projected population growth rate for the coming five years among the 80 markets we analyze.”
The capital of Texas was followed by the Raleigh/Durham metro area. Describing the attributes of the No. 2 city, the report said:
“This market’s concentration of educational institutions – Duke University, the University of North Carolina, North Carolina State University, and several smaller colleges – coupled with the Research Triangle Park, has branded the area as a technology mecca, and it now has more than 89,000 tech jobs, which, at 10.9% of the employment base, ranks third behind Silicon Valley and San Francisco in tech industry share.”
Nashville, Tennessee, was No. 3.
“The local mood is ebullient, with expectations strong for continued investment and development,” the report said. “News on the corporate location front – Alliance Bernstein’s headquarters, an Amazon operations center, and the expansion of dental products firm Smile Direct Club – has bolstered confidence and generated real estate activity associated with more than 8,000 new jobs linked to these firms.”
Charlotte, North Carolina, was No. 4.
“Charlotte is attracting technology and manufacturing firms, as it continues to diversify its economy beyond the banking sector that dominated over the past 20 years,” the report said. “Charlotte has focused on infrastructure, with its airport expansion and light-rail growth emblematic of its commitment in this crucial field.”
Boston, ranked No. 5, was the only northeast city to make it into the top 10.
“Boston enjoys strong structural advantages including its outstanding educational institutions, which act as a talent magnet, and its powerful tech industry, which accounts for 10 percent of Boston’s jobs base,” the report said. “This is an expensive area and has affordability and congestion issues to cope with.”
Here’s the full list of the top 10 markets for real estate in 2020: