Now that cities across the country have properly grieved the loss of the HQ2 they never had, and NYC pretty much dumped Amazon on their Valentine’s day date, we have some serious questions. How many communities have policies in place to handle an economic shock like landing an HQ2? How does plopping 25,000 new high paid tech workers in a city affect housing? This post will look at how Amazon HQ2 might impact housing in Washington, DC.
There are a few things we know:
Washington DC is one of the most expensive housing markets in the US. The median rent is $2,146 per month.
Speculation is rampant. The day of the official announcement there was a 435 percent jump in Zillow users viewing homes in Arlington compared to the same day a year earlier.
If you already own a home, you’re lucky. But for those looking to purchase a home or rent, costs are expected to rise.
Displacement may be an even bigger issue. As costs rise, those that can’t afford housing are pushed farther away from the economic opportunities found in city centers.
As we’ve previously written about HQ2, in places like Seattle, San Francisco, and Washington DC, the cost of living can rise beyond the reach of many non-tech workers.
Over the past decade, the median home price in Washington DC has risen more than 50 percent, from $365K in 2009 to $581K in 2019. Along with that, the cost of rentals has increased significantly, now requiring a minimum salary of $85,840 to afford a median-priced apartment in DC. Ouch.
An estimated 136,000 renters in the DC metro area now spend more than half of their income on rent.
Over the next decade, some policymakers are seeking to stabilize rent and construct new rental units. Communities surrounding HQ2 have promised to create and preserve 2,000 to 2,400 affordable and workforce housing units from 2019 to 2029. These policies will not be enough to both catch up with the past decades’ rising housing costs and adequately address the housing impact of HQ2. An estimated 136,000 renters in the DC metro area now spend more than half of their income on rent. The promised units would address less than two percent of the existing gap.
For communities watching from the sidelines, here are a few resources for thinking about an equitable housing strategy: