When Amazon announced plans to open its second headquarters in Arlington, Virginia, concerns regarding the local housing market began to manifest.
After all, Amazon’s presence is notorious for transforming housing markets, whether that be by driving home values or boosting sales.
Now, Redfin indicates Amazon’s presence has impacted the area – by increasing home prices nearly 18%.
“In April, six months after Amazon announced it would open a second headquarters in the Crystal City neighborhood of Arlington, Virginia, the median home-sale price in Arlington was up 17.7% annually to $655,000 and the typical home that sold went under contract in just six days, down from 10 days last year,” Redfin writes.
Additionally, Redfin discovered that housing supply was down 41.8% year over year, marking the biggest annual decline since March 2013.
As the market continues to heat up, local agents are now saying Amazon’s presence is a factor for nearly every homebuyer and seller this season.
“Sellers in Arlington are excited. It’s nice to have people nearly begging to buy your property,” Redfin Agent Marcia Burgos-Stone said. “But for homebuyers, the market is challenging. Inventory is low because investors are snapping up properties and some would-be sellers have decided to hang onto their homes for a year or two because they believe their values will continue to rise. There are a lot of people in the area who aren’t Amazon employees, and some of them may find it difficult to find and afford homes in the coming years.”
Burgos-Stone may be right as Redfin notes that Washington, D.C’s housing market, which encompasses Arlington, was the third fastest major U.S. market in April.
Redfin Agent Mara Gemond said Amazon’s presence has influenced some home-sellers to price their homes $10,000 or $20,000 higher than they intended before the retail giant’s announcement.
“The Arlington market is smoking hot,” Gemond said. “I can’t remember the last time I had a client make an offer that didn’t face competition. Over the last few months, most of my homebuyer clients cite one of two scenarios, and speculation about Amazon’s impact is part of the thought process for both: They want to buy now either because they’re concerned they’ll soon be priced out of the market, or to secure an investment property for rental and future resale.”