Move over California and New York: Make room for Texas and Utah.
That’s the message of Redfin’s Glenn Kelman, chief executive of the $2.5 billion web-based real estate company, which predicts the surge of migration from coastal to middle America will continue, if not accelerate.
“Silicon Valley is going to leave Silicon Valley,” Kelman told CNBC’s Power Lunch show on Wednesday. “Google employs more engineers outside of Silicon Valley than it does in Silicon Valley, and if Google can’t afford Silicon Valley, then no one can.”
The main driver, Kelman said, of the migration of workers and companies from cities like San Francisco, Los Angeles, and New York, to Houston, Dallas, and Salt Lake City, will be housing prices. That and the new GOP tax plan, which lowers the cap on interest-deductible mortgage debt from $1 million to $750,000.
“Amazon is leaving Seattle! They’re not going to go to Boston, they’re not going to go to New York,” Kelman said. “The technology companies, the Wall Street companies, they are chasing the talent, the talent is chasing affordable housing.”
Although Redfin is based in Seattle, Kelman believes the coastal exodus will be “so good for the country.”
“You shouldn’t have that many people making so much money in just a few cities. It should spread to the rest of the country,” Kelman said.
Watch the full interview here.