SEATTLE, March 1, 2018 /PRNewswire/ -- Experts expect
Amazon to choose either Northern
Virginia or Atlanta for its
new headquarters, according to the 2018 Zillow® Home Price
Expectations Surveyi. Austin and Denver were also commonly cited by experts as
strong contenders.
After receiving 238 bids, Amazon announced in January that it
narrowed its search for a second headquarters ("HQ2") to 20 cities.
In and around the city that Amazon chooses, HQ2 is widely expected
to have a profound impact on housing and the local economy.
Since Amazon announced last October that it would build a second
headquarters somewhere in North
America, it's become a popular game to guess which city they
will choose based on its criteria. Zillow asked over 100 housing
and economics experts to take a guess through their unique lens.
Amazon is expected to announce its choice sometime in 2018.
Among the 20 cities on Amazon's list, Atlanta has the fourth lowest home values and
rents, making it an attractive option for Amazon, which is expected
to hire as many as 50,000ii people to come work at the
new headquarters. Northern
Virginia, part of the Washington
D.C. metro, is among the more expensive housing markets on
the top 20 list, but would put Amazon at the doorstep of the
nation's top policymakers.
As Amazon has grown from a startup bookstore to one of the
country's most prominent retailers, Seattle home values, where Amazon is based,
have almost doubled and rents have increased by half. However,
Seattle's growing pains can't all
be blamed on Amazon -- the jobs boom in and around Amazon's current
headquarters explains less than one-fifth of the region's rising
rent. The company's growth has created a business environment that
has attracted many other employers to the Seattle region.
"As the experience of Seattle
suggests, Amazon will not only directly bring thousands of
high-paying jobs to the chosen city, but also has the potential to
transform the regional economy," said Zillow Senior Economist
Aaron Terrazas. "The local jobs boom
that Amazon's HQ2 promises will spur demand for the full spectrum
of housing types – ranging from urban apartments to suburban
single-family homes. Atlanta has
the benefit of being one of the most affordable markets in the
country, and is undergoing an urban renaissance with new public
infrastructure providing attractive opportunities for employers
seeking to lure young urbanites. Northern
Virginia has its benefits as well, as it's close to a highly
educated workforce and a well-developed public transit
infrastructure in the D.C. area."
In addition to affordability, experts cited land availability,
talent and business friendly tax codes as a few reasons why they
believe Amazon will choose Atlanta
as its second headquarters. A growing tech workforce and easy
access to Washington D.C.
policymakers were noted by respondents as reasons why Northern Virginia may be Amazon's chosen
second home.
Many cities that bid to become Amazon's second headquarters
offered tax breaks and other benefits to the company, which will
likely be considered alongside reasons cited by experts.
The quarterly survey, sponsored by Zillow and conducted by
Pulsenomics LLC, asked more than 100 housing economists and
professors about their overall expectations for the U.S. housing
market, as well as what city they think is most likely and least
likely to be chosen as Amazon's second
headquartersiii.
"The potential economic benefits of hosting Amazon HQ2 are
tantalizing, and will tempt the 20 municipalities still in the hunt
to dangle significant tax incentives to get a deal done," said
Terry Loebs, founder of Pulsenomics.
"These cities should be prepared not only to justify their
financial inducements, but to carefully weigh the social risks and
costs that could accompany their HQ2 commitment. The mix and degree
of these potential risks, such as diminished affordable housing
stock, more congested roadways, and greater income inequality, vary
considerably across the 20 markets."
Among the 85 experts who responded, 12 said Amazon is most
likely to choose Atlanta, 12
selected Northern Virginia, 11
selected Austin, nine selected
Raleigh, North Carolina and six
selected Denver.
Los Angeles, Newark, New York and Miami were the cities respondents said were
the least likely to be chosen by Amazon. Reasons include high
housing costs, traffic and an unfavorable tax environment.
Los Angeles is one of the most
expensive housing markets in the country, with a median home value
of $636,500 and a median rent payment
of $2,738, almost twice as expensive
as the national median. Residents in the Los Angeles metro can expect to put 41 percent
of their monthly income toward a mortgage payment and almost half
toward rent.
Expert
Ranking on
HQ2
Likelihood
iv
|
Finalist
City
|
Metro Zillow
Home
Value Indexv (ZHVI)
|
ZHVI Year-
Over-Year
Change
|
Metro Zillow
Rent Indexvi (ZRI)
|
ZRI Year-
Over-Year
Change
|
Median Metro
Household Income
|
0
|
United
States
|
$
207,600
|
6.7%
|
$
1,441
|
2.6%
|
$
58,960
|
1
|
Atlanta
|
$
187,600
|
7.7%
|
$
1,391
|
4.4%
|
$
63,330
|
1
|
Northern
Virginia
|
$
387,200
|
1.7%
|
$
2,141
|
1.2%
|
$
98,059
|
2
|
Austin
|
$
281,500
|
6.8%
|
$
1,686
|
-0.5%
|
$
69,977
|
3
|
Denver
|
$
384,300
|
7.4%
|
$
2,042
|
2.3%
|
$
75,396
|
3
|
Montgomery County,
MD
|
$
387,200
|
1.7%
|
$
2,141
|
1.2%
|
$
98,059
|
3
|
Raleigh
|
$
235,000
|
6.2%
|
$
1,433
|
2.5%
|
$
68,974
|
4
|
Dallas
|
$
220,900
|
9.2%
|
$
1,604
|
2.7%
|
$
63,249
|
5
|
Nashville
|
$
233,100
|
12.0%
|
$
1,494
|
2.0%
|
$
61,383
|
5
|
Pittsburgh
|
$
138,200
|
3.8%
|
$
1,054
|
-1.5%
|
$
57,373
|
6
|
Chicago
|
$
214,700
|
4.1%
|
$
1,651
|
1.5%
|
$
66,562
|
6
|
Philadelphia
|
$
224,700
|
4.9%
|
$
1,579
|
0.6%
|
$
68,376
|
7
|
Boston
|
$
441,800
|
6.8%
|
$
2,370
|
1.4%
|
$
83,945
|
7
|
Washington
D.C.
|
$
387,200
|
1.7%
|
$
2,141
|
1.2%
|
$
98,059
|
8
|
Torontovii
|
$
743,200
|
5.2%
|
$
1,317
|
1.5%
|
$ 78,280viii
|
9
|
Columbus
|
$
174,100
|
7.9%
|
$
1,317
|
1.9%
|
$
61,153
|
10
|
Indianapolis
|
$
143,200
|
5.2%
|
$
1,209
|
2.1%
|
$
56,931
|
11
|
Miami
|
$
264,200
|
7.0%
|
$
1,858
|
0.1%
|
$
54,141
|
11
|
New York
|
$
431,100
|
6.7%
|
$
2,403
|
0.6%
|
$
72,866
|
11
|
Newark
|
$
431,100
|
6.7%
|
$
2,403
|
0.6%
|
$
72,866
|
12
|
Los
Angeles
|
$
636,500
|
6.8%
|
$
2,738
|
3.9%
|
$
67,285
|
Zillow
Zillow is the leading real estate and rental marketplace
dedicated to empowering consumers with data, inspiration and
knowledge around the place they call home, and connecting them with
the best local professionals who can help. In addition, Zillow
operates an industry-leading economics and analytics bureau led by
Zillow's Chief Economist Dr. Svenja
Gudell. Dr. Gudell and her team of economists and data
analysts produce extensive housing data and research covering more
than 450 markets at Zillow Real Estate Research. Zillow also
sponsors the quarterly Zillow Home Price Expectations Survey, which
asks more than 100 leading economists, real estate experts and
investment and market strategists to predict the path of the Zillow
Home Value Index over the next five years. Launched in 2006, Zillow
is owned and operated by Zillow Group, Inc. (NASDAQ:Z and ZG), and
headquartered in Seattle.
Zillow and Zestimates are a registered trademarks of Zillow,
Inc.
Pulsenomics
Pulsenomics LLC (www.pulsenomics.com) is an independent research
and consulting firm that specializes in data analytics, new product
and index development for institutional clients in the financial
and real estate arenas. Pulsenomics also designs and manages expert
surveys and consumer polls to identify trends and expectations that
are relevant to effective business management and monitoring
economic health. Pulsenomics LLC is the author of The Home Price
Expectations Survey™, The U.S. Housing Confidence Survey, and The
U.S. Housing Confidence Index. Pulsenomics®, The Housing
Confidence Index™, and The Housing Confidence Survey™ are
trademarks of Pulsenomics LLC.
i This edition of the Zillow Home Price Expectations
Survey surveyed 105 experts between January
29, 2018 and February 12,
2018. The survey was conducted by Pulsenomics LLC on behalf
of Zillow, Inc. and asked the experts about their expectations for
the housing market.
ii
https://www.amazon.com/b?ie=UTF8&node=17044620011
iii Of the 100 experts surveyed, 85 responded to the
most likely selection for Amazon HQ2, and 84 responded to the least
likely selection.
iv Ranked by net score – most likely votes minus least
likely votes. Same ranking indicates a tie.
v The Zillow Home Value Index (ZHVI) is the median
estimated home value for a given geographic area on a given day and
includes the value of all single-family residences, condominiums
and cooperatives, regardless of whether they sold within a given
period. It is expressed in dollars, and seasonally adjusted.
vi The Zillow Rent Index (ZRI) is the median Rent
Zestimate® (estimated monthly rental price) for a given geographic
area on a given day, and includes the value of all single-family
residences, condominiums, cooperatives and apartments in Zillow's
database, regardless of whether they are currently listed for rent.
It is expressed in dollars.
vii Toronto housing
data is from the CREA Price Index. Home price data is the average
sale price from January 2018
expressed in Canadian dollars. Zillow estimated the average rent
based on data from CMHC October 2017
data and Statistics Canada Consumer Price Index for Rented Shelter
in the Greater Toronto
metropolitan area, expressed in Canadian dollars. For questions
regarding this methodology, please email press@zillow.com.
viii Source: Statistics Canada 2015 data, expressed in
Canadian dollars.
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SOURCE Zillow