The northern Va region as seen significant growth of the last decade and with the addition of Amazon H2 it will exacerbate the high cost of housing in that area, in addition to new growth in jobs and population. Moving to buy property is pivotal now in order invest or live before prices continue to soar up and availability becomes limited.
Since Amazon’s Nov. 13 announcement that it will establish its second headquarters in “National Landing” — the new name for the area that encompasses parts of Crystal City, Pentagon City and Potomac Yards — the percentage of homes under contract in Northern Virginia rose for three consecutive months. (Amazon founder and chief executive Jeff Bezos owns The Washington Post.)
The Amazon effect
Amazon’s plans call for 25,000 new employees to be based in National Landing over the next decade, starting with 400 this year, followed by 1,200 more in 2020. The final count of Amazon jobs here is expected to reach about 37,850, and additional ancillary jobs are expected to boost employment in the region, too. The average wage of the Amazon workers is anticipated to be $150,000.
The impact while significant to the region will not have the huge initial impact many realtors have hoped for because it will be a gradual effect.
One immediate impact of Amazon’s coming is the redevelopment of Crystal City with more transit options, more amenities and more apartments, which will make the area more attractive and some may move from others areas to take advantage of more amenities and be close to potential job offers at Amazon.
Eventhough the impact may not be significant in the number of people initially, the arrival of Amazon has an effect on the surrounding area real estate market with changes in buying, selling and renting. Maybe people whom have been selling their home or condo’s have taken their properties off the market in anticipation of higher sale prices and rental options.
In the Old Town Alexandria area near National Landing, there was a 47 percent fall in the number of available listings in the third week of February 2019 compared with the corresponding week in 2018, says Will Wiard, managing broker of Weichert Realtors in Alexandria.
Lack of listings will further grow due to Amazon
“The lack of listings in Alexandria can be attributed to the Amazon effect, in some cases because people took their homes off the market,” Wiard says. “For comparison, in Fairfax County, the number of listings was down just 3.7 percent compared to 47 percent in Alexandria.”
This effect makes it increasingly harder for someone to buy especially if they want to pay 300,000 to 350,000 for a place close to that area. The average cost is $ 575,000 in the Arlington/Alexandria area.
This will move non amazon employee buyers further into DC , Montgomery County and Prince George’s County.
New Amazon employees are likely to rent for at least their first year or two in the area, but eventually many of them will want to buy. Real estate agents say they hope that developers will take note and find a way to accelerate building in the region.
Right now, the burst of development in the National Landing region consists primarily of luxury apartments. Approximately 7,400 residential units are planned or are under construction near National Landing, some of which were in the pipeline before Amazon’s decision
Challenges for the region
Rising home prices and increased demand could exacerbate the lack of affordable housing in the region. Arlington County and the city of Alexandria expect to rely on tax revenue from Amazon’s location in the area to fund at least $15 million annually to investment in preserving and creating affordable housing.
After the Amazon announcement, the Virginia Housing Development Authority pledged an additional $15 million annually for five years for REACH Virginia (Resources Enabling Affordable Community Housing in Virginia) in Northern Virginia. That is on top of the $300 million annually that the agency provides for rental housing and $600 million per year for homeownership financing in Northern Virginia.
JBG Smith, Amazon’s development partner, is working with the Federal City Council on the Washington Housing Initiative to preserve or build 2,000 to 3,000 units of affordable workforce housing in the metro area over the next decade.
“Transportation and affordable housing issues were both public-policy challenges before the Amazon announcement, and they will be after, too,” Howell says. “But one great way to address affordable-housing problems is to have more people make more money.”
Other options for places to look that are nearby , metro accessible and afforable in MD are Hyattsville, College Park, Adelphi, Tacoma Park. In the DC neighborhoods such Michigan Park, Brookland, Woodridge, Langdon,Brentwood, University Heights and few others have opportunites to buy rent and invest at afforabale costs.
Moving?
If you are planning to buy keep us in mind. There are still afforable opportunities in the DC area but you have to know where to look and what areas are changing. Contact a realtor we recommend to gain information that will be useful for your in your search. We you are ready to place things in storage or ready to move contact us!
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