DSNews.com, September 28th, 2016
DS News recently sat down with Jeremy Sicklick, CEO and Co-Founder of HouseCanary, to discuss HouseCanary’s info-graphic which depicts the comparison of red states versus blue states in housing market indicators such as home values and the average income spent on housing as well as how this divide with grow looking into the future. HouseCanary notes in this research that since the last election in 2012, the U.S. housing market value has grown by $6 trillion, for a total value of $27 trillion.
Sicklick drives HouseCanary’s vision, strategy and growth to identify interesting and unique ways for leading corporations, investors and individual homeowners to use data to maximize their value in real estate. Sicklick was previously a Partner & Managing Director at The Boston Consulting Group where he helped leading real estate investors deploy billions in capital. Sicklick received his MBA from The Wharton School, and his BS in Accounting from the University of Southern California with highest honors.
With home values nearly double in blue states than in red states, what is causing such a heavy split?
What you’ll find is a lot of the blue states are really on the coast. On those coasts there are some very large cities (on the west coast Seattle, San Francisco, Los Angeles, Portland). All of these cities, for example, are bordered by water and mountains. What you have is the combination of high, great jobs and limited supply. You can only build so much. There’s not that much land to build out anymore. The combination, along the west coast and then on the eastern seaboard and even Florida, job centers with limited land. That’s what drives land values up and home prices up significantly.
What are the factors driving those in blue states to spend more of their income on housing compared to those in red states?
What we find is while the incomes are higher in some of these major power center cities, the cost of either home ownership or rent is also significantly higher. I was just comparing the average rents for a single family residence down the street from us here in San Francisco and it’s over $6,000, while looking at a really nice area in and around the Dallas area, the suburb of Plano, is $1,800 for an average single family home. That highlights the difference that we’re seeing.
What impact might these comparisons have on which candidate voters in these states support?
I think there’s something very broad and interesting that’s happening. We don’t know exactly how this is going to affect the presidential election. With this research, all we were really trying to do was say “there’s this massive divide that’s happening, why is that.” When we looked at it we asked, “Why look at this through the lens of real estate?” Our view was real estate is a majority of Americans’ net worth.
What we were really curious about was whether we could view some of this divide that we’re seeing between red states and blue states through the lens of real estate and the wealth creation that people had. I think it probably answers some of what we’re seeing with the increasing difference in class and wealth but TBD on how that actually impacts the presidential election.