Washington businesses weigh tax burdens as housing supply expands
Policy shifts for housing
Washington state is implementing policies to address housing shortages. Senate Bill 6026 mandates that cities with over 30,000 residents allow residential development in commercial and mixed-use zones. This legislation, championed by Governor Bob Ferguson, also provides flexibility for builders regarding ground-floor commercial space in apartment buildings.
Housing market trends
The Washington State housing market is stabilizing in 2025-2026, with a statewide median home price near $587,000 as of early 2026. Active listings increased by approximately 28% year-over-year by February 2026, offering more options for buyers. Mortgage rates averaged around 6.0% on a 30-year fixed loan in early 2026, a decrease from early 2025.
Business climate concerns
Washington employers are expressing pessimism regarding the state's economic direction. A February 2026 survey indicated that 30% of businesses plan to expand outside Washington, and 17% are considering leaving the state entirely. Rising taxes, healthcare costs, and government regulations are cited as primary challenges.
Infrastructure investment
Governor Bob Ferguson announced a $2.1 billion investment in transportation infrastructure in December 2025, focusing on preserving and maintaining roads and bridges. This funding includes $1.1 billion for bridges and substantial allocations for paving projects over the next decade. Projects like the I-405/Brickyard to SR 527 Improvement Project are also underway, with completion expected by 2028.
Key facts
- Washington's median home sale price was approximately $840,000 in King County as of early 2026.
- Total active housing listings statewide reached 13,341 in February 2026, up nearly 28% from a year earlier.
- Governor Ferguson's supplemental budget proposal in December 2025 included $2.1 billion for transportation infrastructure investments.
- 17% of Washington businesses reported planning to leave the state in a February 2026 survey.
- Washington state crossed 8 million residents for the first time in 2025.