Housing Preferences and Residential Location Choice of Knowledge Workers in the Tel-Aviv Metropolitan Region

Edward Bendit and Amnon Frenkel


The rise of the “Creative Class” in the modern knowledge society and the economic, social, and spatial changes accompanying the transition to a knowledge-based economy in developed countries are reflected in the growing demand for skilled knowledge-workers and in the great effect of these phenomena on the residential choice decisions of households. The research focuses on examining the main underlying residential location determinants of knowledge-workers and their housing preferences at the intra-metropolitan level. The importance of the current research stems from the fact that housing, viewed as a key enabler for attracting and retaining creative knowledge-workers, plays a major role in promoting knowledge-based urban development (KBUD).

The analytical framework used for examining the research hypotheses consists of a variety of analytical tools and statistical techniques, mainly explanatory factor analysis, cluster analysis, and discrete choice models. The population of knowledge-workers residing and working in the Tel-Aviv Metropolitan region was chosen as a case study for the present empirical research. The target population consists of knowledge-workers who work in the high-tech sector and knowledge-workers employed in the financial and business services sector.

A web-based revealed-preferences survey (by means of a custom-designed questionnaire) was designed for data collection. The survey yielded 1,181 responses of knowledge-workers. The retrieved data, analyzed by means of self-organizing maps (SOM), confirmed the hypothesis about the lifestyle heterogeneity of knowledge-workers. Five clusters of knowledge-workers were yielded that significantly differed in terms of holistic lifestyle, encompassing life-cycle stage, work role and leisure-activity pattern, under-mobility, and budget constraints. The five clusters identified were entitled: “nest-builders,” “bon-vivants,” “careerists,” “entrepreneurs,” and “laid-back.” The results indicate that each cluster of knowledge-workers has significantly different residential preferences in terms of residential location, building type, home ownership, and dwelling size.

The empirical results of the location models indicate that knowledge-workers are mainly attracted to the following: dense urban environments and large cities; an abundance of cultural and educational facilities; reasonable housing prices that allow homeownership and large dwellings; ease of access to their workplace and to the spouse’s workplace; accessibility of the metropolitan core; municipalities with a high socio-economic status; and communities that are compatible with their activity pattern. Therefore, municipalities that wish to attract and retain knowledge-workers need to invest in culture and education infrastructures; maintain reasonably priced housing markets and provide either affordable high-quality housing or housing (location) incentives; guarantee knowledge-job opportunities or good transportation to knowledge-based employment centers.