Amazon's HQ Decisions Raise Questions About Seattle
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What is the main topic discussed in this episode?
With your Money Briefing, I'm J.R. Whelan at The Wall Street Journal in New York. Amazon's decision to build additional headquarters in New York and Virginia is good news for those regions, but not for its home city of Seattle. We'll explain why in a moment. First, these money and market stories you should know. Consumers were not stingy with their wallets over the holiday weekend, and that strong holiday shopping gave investors some seasonal cheer. Retail stocks like Amazon, along with Target, Macy's, and Kohl's popped on Monday after taking a beating in recent weeks. And it might be worth keeping an eye on retail stocks. The National Retail Federation expects online and in-store sales in November and December to increase as much as 4.8% to $720 billion, compared with the same period in 2017.
How did Amazon’s HQ2 announcement affect Seattle’s housing market outlook?
And Bitcoin continued its precipitous drop on Monday, closing down 6% to near $3,800. That continues a profound slide, and it bucks a modest rebound happening meanwhile in stocks and oil. The digital currency has now fallen by about 80% since peaking near $20,000 late last year.
What signs showed Seattle’s housing market was already cooling before HQ2?
For every yen, there's a yang. Amazon's announcement that it will build new headquarters in New York and Virginia is mostly seen as good news in those regions. But in Seattle, the decision means a cloudy future for the city's housing market. And Wall Street Journal reporter Laura Casisto is here to explain why. So, Laura, Seattle's housing market was already facing troubling times even before the search for a second Amazon headquarters began.
Yeah, or I would say certainly even before the announcement of the headquarters, there was already kind of a looming sense of anxiety in the city. Prices have gone up dramatically. There's been a lot of new rental supply built. And there was just sort of a sense that, you know, the party was kind of over.
Why are rising mortgage rates and high prices bigger threats than HQ2 for Seattle?
You were seeing more price cuts, fewer bidding wars. You were seeing homes sit on the market longer. And so Amazon's announcement just, I think, solidifies in people's minds that Seattle isn't going to be sort of an outlier as much going forward.
And prices had come down in Seattle?
How is Seattle’s apartment market reacting to fewer young professionals and increased supply?
Prices had come down month over month, but I would say generally just price growth has slowed a lot.
What short‑term benefits might renters see as Seattle’s rental market softens?
Seattle had the fastest home price growth in the country for two years running, and now it's kind of falling further back in the ranks.
And the fear is that a sizable number of Amazon workers living in Seattle will pick up and leave for one of those new headquarters sites.
That is less of a fear than it would have been had they gone to, say, Dallas or Nashville, places where people could go and get a mansion for the price of a sort of small tutor in Seattle. But there can definitely be people, especially people who are originally from the Northeast who relocated to Seattle for work, who are going to look at this and say, ah, New York is like a pretty cool place.
Could Amazon employees actually relocate to New York or Virginia and how would that impact Seattle?
Crystal City is, you know, what it is. And maybe decide it's time to head back home.
Yeah, and to live in those two cities, I mean, it's kind of on par with Seattle. It's not exactly you're getting a discount plan if you were to travel across the country to those places.
Yeah, I mean, there would have been a time where Seattle would have even been more affordable than those places. But prices have gone up so much in Seattle, they're probably close to on par. So that is less of a threat for sure. But there's also just sort of the threat that the focus, Amazon's focus kind of gets diverted. These are going to be that kind of new kids on the block and Seattle might just be get a little less of its attention.
People you spoke with for your story said that while some Seattle residents may look to move away, it's rising interest rates and higher prices that are the real thorns in the Seattle housing market.
Yeah, and that's really the story across the country. Seattle isn't the only market that's slowing. Dallas is slowing. Denver is slowing. New York is slowing. Most of these really hot markets that recovered really strongly, they're all slowing.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:05–0:51
2
How did Amazon’s HQ2 announcement affect Seattle’s housing market outlook?
0:51–1:19
3
What signs showed Seattle’s housing market was already cooling before HQ2?
1:19–2:00
4
Why are rising mortgage rates and high prices bigger threats than HQ2 for Seattle?
2:00–2:15
5
How is Seattle’s apartment market reacting to fewer young professionals and increased supply?
2:15–2:19
6
What short‑term benefits might renters see as Seattle’s rental market softens?
2:19–2:52
7
Could Amazon employees actually relocate to New York or Virginia and how would that impact Seattle?
2:52–4:59
Speakers
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