Microsoft Pledges $500M for Affordable Housing in Seattle
Having a successful tech company on your doorstep can be a boon for other local businesses, the jobs market, and the local economy as a whole. But it has another undesirable impact: housing prices rise as demand increases, meaning affordable homes for those on lower incomes disappears. In Seattle, home to both Microsoft and Amazon, there's a housing crisis and Microsoft decided it's time to do something about it.
Yesterday, Microsoft committed to spending $500 million "to advance affordable housing solutions." The investment will be split into three parts. $225 million will be used for middle-income housing spread across six cities east of Seattle and Lake Washington (Bellevue, Kirkland, Redmond, Issaquah, Renton and Sammamish). $250 million will be used for low-income housing across the King County region, with a focus on accelerating as well as expanding construction.
Finally, the remaining $25 million will form a philanthropic grant scheme. Its focus is on addressing homelessness across Seattle. $10 million of that has already been earmarked for two programs. $5 million will go to the Home Base program, which helps people facing eviction through legal aid, flexible funds, and case management. The other $5 million is going to a new joint agency formed by the city of Seattle and King County to tackle homelessness.
Microsoft is well aware the investment isn't enough to solve the problem, but it's a start. The company has called the Puget Sound region its home since 1979 when it had just 30 employees and 40 years later it's still growing. However, in 2011 Microsoft noticed a change. Since then, jobs in the region grew by 21 percent, but housing construction increased by just 13 percent. That caused housing prices to surge by 96 percent and Greater Seattle is now the sixth most expensive region to live in the US.
As the video above shows, if your housing is too expensive for middle and low income families, then the teachers, police officers, nurses, and those working in your local store all end up commuting, or they simply don't take the jobs. That's what Microsoft is hoping to help fix and it's calling on others to help.
Microsoft believes public policy needs revamping and the state government must play a role. Zoning rules need to change, desirable public land must be made available, tax incentives are required for construction, and housing investment is necessary by the government. One recommendation being put forward is a $200 million appropriation to the Housing Trust Fund "to expand support for very-low-income individuals and families, which would almost double the investment from the last budget cycle."
Although Microsoft is looking to the local and state government, there's also clearly a role for other successful companies to play in this. Microsoft just showed us what's possible, now it's up to the other big players in the technology and other sectors of industry to step up.