Companies Pay Workers to Live Close to the Office

As housing costs soar in tech hubs like Silicon Valley and New York City, some employers are turning to an unconventional retention and recruiting tool: paying employees to live closer to the office. The strategy is designed to offset high rents while reducing commute-related stress that can erode productivity and tenure.

Companies such as Addepar and Facebook offer housing stipends, relocation assistance, and apartment-hunting support to encourage employees to live nearby. At Addepar, workers can receive $300 per month if they live within one mile of the office (or 15 minutes in Manhattan), with smaller stipends available for those slightly farther out.

According to Addepar’s head of HR, the goal is simple: shorter commutes free up time and energy. Less time spent traveling means more time for work, family, and recovery—factors that managers say translate into stronger engagement and longer tenure.

Internal data supports this intuition. A large-scale analysis conducted by workforce analytics firm Evolv (acquired by Cornerstone OnDemand) examined millions of performance reviews and found that employees with commutes under five miles stayed at their jobs about 20% longer on average. Longer commutes were associated with higher stress and poorer health outcomes.

Employees echo these findings anecdotally. Workers who move closer to the office report lower stress, more time for hobbies, and greater flexibility in how they structure their workdays. Managers note that proximity also increases the likelihood of collaboration, social bonding, and discretionary effort—such as staying late to finish projects.

Some organizations take the idea further. At Zappos, hundreds of employees have moved within a few miles of headquarters, supported by housing initiatives tied to downtown revitalization. Advocates argue that spending more time together outside work builds trust, creativity, and commitment inside it.

Still, the approach is not universally appealing. Research on work–life boundaries suggests that some employees—so-called segmentors—prefer a clear separation between personal and professional lives. For them, living too close to work or socializing heavily with coworkers can feel intrusive rather than motivating.

The effectiveness of housing subsidies can also change as employees’ lives evolve. At Gusto, a generous housing stipend lost relevance as more workers became parents. The company ultimately replaced it with expanded family benefits that better matched employees’ shifting priorities.

Overall, the evidence suggests that proximity matters—but only when aligned with employee preferences and life stages. When thoughtfully designed, housing incentives can reduce stress, strengthen social ties, and meaningfully improve retention. When misaligned, they risk becoming an expensive perk with diminishing returns.