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Home Value Forecast: A Closer Look at the Top Metros Vying for Amazon HQ2

There’s been much speculation as to where Amazon will build its second headquarters and for good reason — it’s been reported that the city Amazon ultimately ends up choosing will “change forever.” With estimates that Amazon’s HQ2 will create more than 50,000 new high-paying jobs, landing the opportunity would certainly be a bonanza for any metro.

So where is it going to be? If you search the internet, there are a number of predictions available. Moody’s predicts one of the following ten cities, listed in order, will lure Amazon in:

1. Austin, TX
2. Atlanta, GA
3. Philadelphia, PA
4. Rochester, NY
5. Pittsburgh, PA
6. New York, NY
7. Miami, FL
8. Portland, OR
9. Boston, MA
10. Salt Lake City, UT

The Moody’s predictions leveraged five categories — business environment, human capital, cost, quality of life and transportation — to come up with the top ten cities sure to land Amazon. But what other factors will play a role?

Home Prices & Forecasted Appreciation in the Top 5 Metros Likely to Land Amazon

In this month’s Home Value Forecast, we look at current prices and forecasted appreciation in the five top-rated metros to see whether it makes sense for Amazon to locate HQ2 in one of these cities.


Of the top metros on Moody’s list, Austin and Atlanta are the two hottest markets, with the CBSA level average home prices at $310,000 and $200,000 respectively. Both markets have rebounded nicely since the housing crisis, showing marked appreciation since 2011.

The three others, Pittsburgh, Philadelphia and Rochester, have all seen only modest gains since the crisis. While not as “hot” as Austin and Atlanta, an influx of 50,000 new high-paying jobs would have an impact, and would certainly jump-start home appreciation in each metro.

Will Educational Opportunity Factor in Amazon’s Decision?

In addition to “looking for a metro area with more than 1 million people and a stable and business-friendly environment with the potential to attract and retain strong talent,” Amazon is also reportedly weighing several other key decision drivers, such as: presence and support of a diverse population, an overall high quality of life and a strong university system — attributes that are all present in Seattle, home to Amazon’s original headquarters.

At Home Value Forecast, we agree that any metro in the running needs to have a steady stream of educated talent. In a previous Home Value Forecast, we’ve looked at the correlation between the percentage of college educated individuals per metro area and home values. Today, we can see that eight of the ten metros predicted by Moody’s as suitable sites for HQ2 are represented.

In Amazon’s current hometown, 35% of the population over 18 has a bachelor’s degree or higher. Comparatively, 36% of Austin’s population over 18 has a bachelor’s or higher degree. Atlanta has 32% and Philadelphia has 30%ochester and Salt Lake City failed to make the list.

To us at Home Value Forecast, either Austin and Atlanta would be great picks for Amazon.

Affordability in the Top 2 Metros in Line for HQ2

Now let’s look at the Collateral Analytics Affordability Index for each metro. Affordability is derived by looking at the median income for an area as a ratio to the mortgage payment needed to purchase a median priced home. An index score above 100 signifies that a household earning the median income has more than enough income to afford the mortgage. Lower scores suggest more income is needed to cover mortgage expenses. The Collateral Analytics Affordability Index used by Home Value Forecast also looks at loan-to-value norms for a particular area to adjust for more affluent buyers usually putting more money down. Seattle’s Affordability Index is currently 123.




In Austin, you can see two “bubble periods,” one prior to the dot-com crash in 2001 and another in 2006 before the housing market crisis. Today, Austin is at 157, making it more affordable than Seattle.

Atlanta was traditionally around 160 until the housing crash dropped home prices, making them more affordable for all. Now Atlanta’s affordability is at 215, giving Amazon the opportunity to keep current pay structure or pay less for similar jobs in Atlanta while still maintaining a similar standard of living as co-workers in Seattle.

In Conclusion

So, what does this all mean? If Amazon is looking for an area with a healthy real estate market, an educated workforce and affordable housing, then Austin and Atlanta would be at the top of the list. Both cities have traffic and public transit issues, but these days most cities do. If we had to choose one, we would choose Atlanta.

Amazon has received 238 proposals from cities around the country, offering tax incentives, infrastructure, and even naming rights to towns. We will see what is most important to Amazon once the winner is announced. Stay tuned for an in-depth assessment of the lucky metro once it is announced.

About Home Value Forecast

Home Value Forecast (HVF) is brought to you by Pro Teck Valuation Services. HVF provides insight into the current and future state of the U.S. housing market, and delivers 14 market snapshot graphs from the top 30 CBSAs.

HVF is built using numerous housing and economic data sources. The top 750 CBSAs as well as data down to the ZIP code level for approximately 18,000 ZIPs are available with a corporate subscription to the service.

Also, Pro Teck Valuation Services offers reporters the following:

  • National, regional or metro level housing data
  • Monthly updates and HVF insight articles
  • By-request data for your story — custom data, heat maps and charts are available
  • Expert commentary from Home Value Forecast Editorial Committee:
    • Tom O’Grady, Chief Executive Officer, Pro Teck Valuation Services
    • Michael Sklarz, Ph.D., President, Collateral Analytics
    • Jeff Dickstein, Chief Compliance Officer, Pro Teck Valuation Services


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