Could Amazon’s return-to-office policy be driving up rent?
![caption: Amazon employees returned to work en masse in downtown Seattle Thursday after a companywide policy went into effect requiring most workers to be in the office five days a week.](https://kuow-prod.imgix.net/store/629231ca3de6e63b137a9af297b73b4c.jpg?ixlib=rails-4.3.1&fit=clip&crop=faces&auto=format&w=924&h=634)
In the weeks since Amazon has called employees back to the office five days a week, businesses surrounding the company’s Seattle headquarters have been celebrating the return of thousands of customers downtown.
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The cost to rent an apartment downtown grew 2.5% last month, the first year-over-year increase in more than 12 months, according to a new report from Redfin.
The median monthly rent for an apartment downtown was $2,000 in December. The uptick came as Amazon’s corporate workforce prepared to return to the office five days a week, under a policy that took effect the first week of January.
Redfin Senior Economist Sheharyar Bokhari said the findings came as a bit of a surprise because so many new apartment buildings are opening up in the area.
“There's a lot of supply coming on, so we were expecting rents to just continue falling,” he said. “But, obviously, this is a very dynamic market where there's a lot of job opportunity."
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Still, he said it was too soon to tell whether the uptick in rent is the start of a trend – and how much Amazon’s policy is driving it.
Although Bokhari can’t predict how return-to-office mandates will affect demand, he is confident the supply of new apartments will decrease in the coming years.
The abundance of new buildings coming online now is a product of low interest rates that were available when developers broke ground. Redfin is seeing a slowdown in new construction now that interest rates have climbed.