Microsoft wants to advance affordable housing in Seattle near its Redmond base, and is committing $500 million towards that goal.
Microsoft has been based in Redmond, near Seattle’s Puget Sound region since its founding in 1979. Since that time it’s grown to become one of the biggest technology companies in the world, but it says the local housing market has failed to keep up with its growth.
Moreover, job growth in the region has risen by 21 percent since 2011, while new construction has lagged at just 13 percent. As a result, home prices in the area have skyrocketed, which means those taking up the new jobs often struggle to find affordable accommodation.
“This gap in available housing has caused housing prices to surge 96 percent in the past eight years, making the Greater Seattle area the sixth most expensive region in the United States,” Microsoft President Brad Smith and Chief Financial Officer Amy Hood said in a blog post they co-authored.
Another problem is that median incomes in the area haven’t grown at the same rate as housing costs.
That’s why Microsoft feels it has a duty to help. The $500 million it’s donating will be used to subsidize the preservation and construction of middle income housing in the area. It will also be used to support low income housing, Microsoft said. It’s also planning to use around $25 million of that money in the form of grants that will be used to address homelessness.
“Our goal is to move as quickly as possible with targeted investments that will have an outsized impact,” Smith and Hood wrote.
Some of the money will be used to provide short-term loans to help those who want to build affordable housing.
“With these and similar investments, it’s possible to lend money, accelerate progress, be repaid, and then lend this money again,” Smith and Hood said, noting that they hope Microsoft's commitment will have a multiplier effect.
Microsoft officials have also teamed with the mayors of nine of the largest suburban cities outside of Seattle to address changes to the zoning to increase affordable housing and create new tax incentives to spur greater construction.
Microsoft says this is just the beginning of trying to fix a long-term challenge. “We’ll all need to learn and work together to ensure that everyone in our community has not just a roof over their head, but a place they can call their home,” the Microsoft officials say about the company's pledge.