Did Amazon’s Return to Work Mandate Cause Seattle Rents to Rise?
Apartment rents are going up in Seattle for the first time in 17 months, and Amazon has ordered all workers back to the office five days a week. Is there a connection?
Not necessarily, according to Redfin senior economist Sheharyar Bokhari. Bokhari says it’s too early to tell, especially since many Amazon workers already live within commuting distance.
What could be happening, he said, is that after years in which Seattle saw more new apartment buildings built than anywhere else outside the Sunbelt, new construction is tapering off. This could be the factor driving up rents in desirable inner-ring neighborhoods.
In late 2024, Amazon announced that effective January 1, 2025, all staff must be in the office five days a week, instead of the required three days before. In December 2024, just before the rule went into effect, the median rent in downtown Seattle rose 2.5% year-over -year to $2,000.
The latest rent increase follows a kind of rent roller-coaster. From $2,500 before the pandemic, rents dropped to $1,399 as tech workers started working from home. When offices started to reopen, rents shot back up to $3,118 in August 2022, then dove 36% before the newest uptick as new construction climbed.
With Amazon’s back-to-office rule now in effect, rumor has it that daily commute times have gotten longer and that there is more traffic on the roads. Plus, it's worth noting that Amazon's RTO demand has been halted because the company does not have enough workspace to house them all just yet, according to Business Insider.
Meanwhile, in Seattle as a whole rents, have risen 0.5% to $2,017 compared to December 2023. However, the impact has varied among neighborhoods, ranging from a 7.2% increase to $1,825 in Capitol Hill to a drop of 13.7% to $1,981 in Queen Anne and a 13.5% drop to $2,385 in South Lake Union.
On the east side, where many of Seattle’s tech workers live, the median rent in downtown Redmond rose 4.3% to $2,350 but slumped 3% in downtown Bellevue to $2,579.
As new construction continues to shrink and more workers return to offices, Seattle rents could continue their upward trend.
Source: GlobeSt/ALM