AI Data Centers Are Outbidding Home Builders for America's Land

Editor’s Note: This article was excerpted from a longer piece in the Land Use 101 section of nahb.org. Read the full article.

In November 2025, two of Northern Virginia’s largest recent land deals closed within days of each other. Amazon paid $700 million for about 189 acres in Prince William County and a few days later, SDC Capital Partners paid $615 million for 97 acres in nearby Loudoun County.

Both counties, located in the outer suburbs of Washington, D.C., have experienced a housing boom for at least a decade. But the land deals weren’t for home building. Construction on data centers began on the land almost immediately after it closed.

As AI use has grown, so has demand for the facilities that make it possible. That demand is being met with land, and much of it is land that would otherwise have become housing. And in Northern Virginia, the self-proclaimed “data center capital of the world,” it has completely skewed the market for buildable land.

In Northern Virginia alone, some of the deals that have closed since 2024 include:

• In Loudoun County, the SDC deal came out to about $6.3 million per acre.
• In Prince William County, Microsoft paid $465.5 million for about 124 acres in 2024, or about $3.75 million per acre, about the same price as the 2025 Amazon deal in the same county.
• In Fairfax County, Starwood Capital Group agreed in 2026 to buy about 42 acres of county-owned land in Chantilly, Va., for $166.8 million, or about $4 million per acre, for potential data center development.
• In Ashburn, Va., Amazon agreed to buy George Washington University’s roughly 120-acre Virginia Science and Technology Campus for $427 million, with the deed reportedly allowing a data or information technology center on the site ($3.5 million per acre).

In March 2026, a data center developer reportedly began offering home owners in Ashburn’s Regency neighborhood about $4.4 million per acre to assemble a roughly 130-acre site.

Median land prices in Northern Virginia are nowhere close to those figures. A 2025 land price analysis reported median land prices of about $125,000 per acre in Loudoun County and $93,750 per acre in Prince William County.

The problem is not limited to Virginia. Other examples are occurring all across the country, such as:

• In Illinois, Stream Data Centers bought and razed 55 homes in Elk Grove Village to make way for a three-building data center campus.
• In North Las Vegas, VanTrust Real Estate sold nearly 205 acres in Apex Industrial Park to Novva Data Centers for $181 million in 2025, or more than $880,000 per acre.
• In Texas, HousingWire reported that land along U.S. Route 67 that had sold for $20,000 to $40,000 per acre a few years ago was selling for more than $350,000 per acre by 2026. One local residential land developer put it plainly: “There’s no possible way you can make those numbers work.” 

At a January 2026 state hearing, Andrew Clark, a lobbyist for the Home Builders Association of Virginia, said data centers are “outbidding residential developers” in much of Northern Virginia. Local governments are no longer just deciding where to put data centers. They are deciding whether residential development can compete for land and grid capacity at all.

State and local officials have been slow to enact restrictions on data centers, and when they do act, it’s typically to limit the facilities’ use of water and power. Citizens have begun speaking out more forcefully and filing lawsuits.

NAHB is not aware of any reported litigation in which a home builder has directly sued a data center operator or developer over land competition. The fight, at least so far, is being led by neighbors, not builders.

NAHB is tracking the impact of AI and data center land acquisition on residential development across the country and will continue to monitor any litigation arising from this growing competition for land.

Read the full article in Land Use 101.