Amazon HQ2: Which Markets Would Feel the Most Impact?

Where will Amazon's second headquarters finally land? It's one of the biggest business questions in years, and it has generated many other questions. One of them is, which cities would see the feel the biggest impact on the local housing market from Amazon's HQ2?

Zillow's money is on Nashville and Denver. The site said Wednesday that if workers started punching in at HQ2 in Nashville a year from now, the pace of rental price increases would be double what they would be without Amazon coming to town. In other words, median rents, now a little over $1,500 a month, would rise by 2.4 percent.

A close second is Denver, which Zillow said would see a 2.3 percent bump in rents that are currently around $2,000 a month, median. Los Angeles, Raleigh, and Pittsburgh could also see a nearly 2 percent uptick in rents.

The prize, of course, is an estimated 50,000 new jobs in whichever city Amazon selects.

“And with those new jobs will likely come new residents, which in turn will boost demand for housing and potentially push up housing costs, particularly rents,” Zillow reported.

Of the remaining 12 cities still in the running for HQ2, only one—Indianapolis—would see no change in rents, according to Zillow's research. The only non-U.S. market under consideration, Toronto, would see a barely visible 0.2 percent uptick in rents. The Northeast Corridor also looks to have little potential disruption in the rent because of HQ2. Philadelphia and New York would each see median rent prices inch up less than 1 percent.

The same is true for Atlanta and Washington, D.C. (i.e., northern Virginia), which Zillow in March dubbed the most likely Amazon HQ2 candidates. Were Amazon to open in a year, Zillow reported, rents would tick up about a half-percent in these metro areas.

“Over the past decade, Amazon’s growth from a startup bookseller into one of the nation’s leading retailers has transformed its original hometown of Seattle,” Zillow reported. The region has consistently ranked as one of the nation’s hottest housing markets, though many forces beyond Amazon’s growth have propelled the Seattle market in recent years.”

What that translates to for cities under consideration is that “all but two of the HQ2 finalist markets should expect a smaller impact on rents than Seattle has experienced,” Zillow reported.