Author Topic: Amazon HQ2 impact on real state. Should/when to buy?  (Read 2411 times)

Lisp79

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Amazon HQ2 impact on real state. Should/when to buy?
« on: October 14, 2018, 09:14:14 PM »
Amazon is about to pick a city to locate their second HQ. This will definitely have an impact on the real state market of the city that wins. I happen to live in one of the cities that has a decent chance to win according to some analysis and I plan to live here long term for family reasons  (obviously regardless of amazon)  So for the last 3 years I have been saving up money to buy a property (I am currently renting). The thing is that I know exactly the area and type of house where I want to live and have already enough money to buy, but for multiple reasons I currently have a very good deal renting the property I live in, so I have no plans on buying at least in the next 2 or 3 years.

Now, I have been thinking about what am I going to do if Amazon picks my city because I am a little bit concern about the potential or certain increase in the house market prices in the area I want to live in.  Obviously I am not going to speculate and buy something before Amazon makes a decision... but if finally my city lands Amazonís hq2 I would like to be Ďsmartí and use it as an opportunity. So... Should I speed things up and buy the property I want right after the decision is made to avoid buying when prices are in peak value? Which I imagine it will happen after the HQ are built and new workers come in (maybe in a year or so) Or Should I stick to my original plan and continue renting with the risk of overpaying for a house once i decide to buy?

Just clarifying that I am completely sure I  want to live in this city, and know exactly the area and type of house i want. Also I want to clarify that due to my current deal, renting the house I live in.... is allowing me to save s very good amount of money which I would not be saving otherwise.

Happy to hear everyoneís opinions.
« Last Edit: October 14, 2018, 09:26:09 PM by Lisp79 »

Paul der Krake

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #1 on: October 14, 2018, 09:45:58 PM »
Everyone and their mom is watching this. Why would anyone sell to you at current prices after the city is picked?

Or are you saying your the selection of HQ2 is in fact under-hyped and after the announcement you can buy at a price that won't fully capture the future growth potential?

Lisp79

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #2 on: October 15, 2018, 12:43:31 AM »
I imagine prices will go up progressively. So just for illustration purposes if the house is selling for 200k today (pre-amazon), it will sell for 225k month #3 post-amazon (hq building still need to be built), and for 250k month #24 post-amazon (hq building is finished and workers start coming in).

If I buy right after the decision is made I would probably be buying at month #3 prices. If I keep renting for 2 years and then buy, I will be saving good money every month, but I will be buying at month #24 prices.

This is how I think prices will unfold, just my theory. Regardless... fingers crossed so that amazon goes somewhere else....
« Last Edit: October 15, 2018, 12:49:08 AM by Lisp79 »

Jon Bon

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #3 on: October 15, 2018, 07:34:45 AM »
Prices might jump in the first 6-12 months but then I think they might revert to the mean a little. I mean it takes a long time to build a place that can house 50k people, then hire all those people. Then all those people need to buy/rent houses.

I however am totally selling and relocating if they pick my hamlet.

Should make for good TV.

nkt0

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #4 on: October 15, 2018, 07:58:58 AM »
You should probably buy now. Just buy a few properties in each of the twenty finalists. You'll hit on one of them! :)

HamsterStache

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #5 on: October 15, 2018, 09:59:47 AM »
I am no real estate expert, but I highly doubt the impact will be very immediate. If anything, there will be a spike in the the first few weeks after the announcement as sellers get excited and try to take advantage, but until there is an actual higher demand in the coming years I would think the growth would be only slightly accelerated.  As Amazon takes real hold though, that's when prices will really start changing - probably a few years down the road. Again, just speculating here.

Personally, I also live in one of the locations highly favored to be chosen, actually only a few miles away from one of the possible locations should this area "win."   While I don't plan on selling any time soon, I'm quite happy at the potential this represents regarding my property value.

AMandM

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #6 on: October 15, 2018, 12:24:33 PM »
Personally, I also live in one of the locations highly favored to be chosen, actually only a few miles away from one of the possible locations should this area "win."   While I don't plan on selling any time soon, I'm quite happy at the potential this represents regarding my property value.

I live in a possible HQ2 place too, but I dearly hope they don't pick us. The last thing our area needs is more high-income tech people driving up prices for the rest of us.  An increase in the value of my property only means more real estate taxes.

Lisp79

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #7 on: October 15, 2018, 09:53:14 PM »
Thanks for your opinions. itís hard to predict what will happen but I agree that probably we will see a roller coaster of prices up and down between the moment when the decision is made and when the hq2 actually starts to operate.

HamsterStache

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #8 on: October 16, 2018, 07:24:33 AM »
Personally, I also live in one of the locations highly favored to be chosen, actually only a few miles away from one of the possible locations should this area "win."   While I don't plan on selling any time soon, I'm quite happy at the potential this represents regarding my property value.

I live in a possible HQ2 place too, but I dearly hope they don't pick us. The last thing our area needs is more high-income tech people driving up prices for the rest of us.  An increase in the value of my property only means more real estate taxes.

My area is already has incredibly high cost of living, so I don't foresee much potential change other than making some currently less desirable neighborhoods increase in value based on proximity to metro and/or HQ itself. Two miles down the road, property values are practically double, just because of the schools. I'm not oblivious to the potential downsides, including higher taxes, but I think the change would end up on the positive side for us here. Now if only Bezos stopped holding everyone in suspense and we could just get on with life... ;-)

affordablehousing

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #9 on: October 16, 2018, 02:37:22 PM »
I think the workers have nothing to do with it. If you know what you want and you can do it now, do it now. It will take time for Amazon employees to buy the housing and increase prices, yes, but there are professional overseas investors doing true investing, betting on appreciation from things like, oh, 25,000 software programmers moving to a city, that will work through their network of brokers and pull the trigger on hundreds of houses as soon as the news is announced. Plus you have the overall market dynamics changing things quickly, I think you could easily find yourself out of luck if you miss a window of affordability and know what you want.

kenmoremmm

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #10 on: October 17, 2018, 02:58:15 PM »
i suspect, unlike with HQ1, that investors will flock like locusts and take a buy and hold approach until the employee tech $$$ starts flowing in. then, try to cash out. i think it'll be immediate; everyone is watching this.

Lisp79

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #11 on: October 17, 2018, 04:23:43 PM »
I think the impact will be immediate on small cities like Raleigh but What do you guys think of the impact this will have on real state prices in big cities like LA, Chicago, NYC or DC (front runner according to some media)? Do you think these cities will be able to absorb 50.000 workers without blowing up real state prices ?

affordablehousing

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #12 on: October 18, 2018, 01:02:11 PM »
@lisp, if the market is big enough to absorb 50,000 new renters/buyers without price changes, I must have missed the news that vacancy rates are at all time highs. I think even with large cities, that new demand, of that many professionals, will have an impact. It might be more muted in New York since an Amazon salary doesn't buy much there, but everywhere else I'd imagine a shift.

bisimpson

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #13 on: October 23, 2018, 05:05:01 PM »
Interesting thoughts. We live in an area that's gotten a lot of HQ2 play, but they still haven't decided where it will land if they come here. It could be in our backyard or a 2-hour commute from our area. A builder is putting in a 500 unit subdivision down the road. I suspect that it might have something to do with this.

I don't know how great a deal you're getting from your rent, but you may pay more by jumping into a more expensive house now and losing your deal. Do you think your landlord may raise your rent if Amazon comes into the area?

To be honest, you're probably too late to take advantage of this.

Cassie

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #14 on: October 23, 2018, 05:10:23 PM »
WE have had some tech companies come in and our real estate prices are skyrocketing. In a area of 250k population they predict 50k moving in the next 5 years . Plenty have come in the last 2 years. Rents are horrible and nowhere for people to live.

Megma

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #15 on: October 26, 2018, 01:44:07 PM »
I'm also in one of the top 20, though I don't think one that is likely to be picked, and I have also thought about this. My husband and I are really close but not ready to buy a "long-term" house for ourselves, currently living in what we plan to become rental #2 and I expect prices will go up if we're picked, (many other areas on the list have high prices, weíre much more affordable, thus I expect more impact here). I am hoping we can buy before the announcement just in case, but I have wait until weíre ready.

On the other hand, prices might go up for rentals too. Probably not the ones we own, but you never know.

I'm a red panda

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #16 on: October 26, 2018, 07:05:33 PM »
You should probably buy now. Just buy a few properties in each of the twenty finalists. You'll hit on one of them! :)

That's not really what OP is speculating on.

affordablehousing

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #17 on: November 02, 2018, 03:26:21 PM »
Just realized the obvious answer- buy a house, and play master tenant on your good rental deal, and try to uprent to a new sub-tenant.

Apple_Tango

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #18 on: November 02, 2018, 04:45:10 PM »
Iím in 2 of the top 20 lol. Fairfax County- and 5 miles from Washington DC. I HOPE we donít get it. Our traffic is already freaking terrible. And I wonít be able to buy a house until 2020...I donít want to be priced out either. It would be better to put it in a more rural place that needs more economic stimulation. I would love to see it go to West Virginia...too bad that state isnít on the list.

BlueHouse

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #19 on: November 02, 2018, 05:02:56 PM »
I have a condo in Reston, VA, and once the silver line (metro) is complete, I'll be on the Reston Town Center metro.  I'll sell my condo right now for the same price I bought it in 2005 to anyone who wants to buy it.  You'll get all of the appreciation from 2005 to now and you'll be able to cash in on a popular place. 
DM me if interested.

ETA:  I didn't actually mean this as a sales pitch, and I'm sorry if it came across that way....I meant it to show that speculative and even non-spec real estate purchases can go sideways.  I bought a condo at the top in 2005.  In 2018 it's still only sellable for about $50K less than I paid.  I currently have it rented out and yes, I lose money on it every single month. 

Offer to sell is still open!
« Last Edit: November 11, 2018, 03:54:50 PM by BlueHouse »

HamsterStache

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #20 on: November 05, 2018, 08:26:32 AM »
Looking very likely that Crystal City VA is going to be the winner - not sure how much that is going to end up affecting me up in Montgomery County (also a finalist) but could be interesting!

Apple_Tango

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #21 on: November 05, 2018, 01:01:01 PM »
Very annoying. Where will the people go? The roads are already jam packed. Iím 4 miles away from Crystal City and it already takes me an hour to get there in rush hour. Luckily I take the metro most days, but the metro is also jam packed lol.

I wish I had the money for a house now. Itís looking like 2020 or 2021 for me. Hope housing prices donít jump too high before then, already any 1 bed 1 bath condo goes for $150,000 plus $400-$1000 per month in condo fees. The townhouse complex im looking at is a little better- a 2 bed 2 bath for $280,000 plus $100 monthly condo fee.

Jon Bon

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #22 on: November 05, 2018, 05:06:06 PM »
WSJ said they were going to split it, 2 mini HQ's.

Even still IMO putting it anywhere within 100 miles of DC feels foolish. Already has some of the worst traffic in the country.

But what do I know? I am no billionaire CEO!!


kenmoremmm

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #23 on: November 05, 2018, 05:43:48 PM »
probably a political influence play for bezos more than anything.

HamsterStache

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #24 on: November 06, 2018, 12:21:53 PM »
WSJ said they were going to split it, 2 mini HQ's.

Even still IMO putting it anywhere within 100 miles of DC feels foolish. Already has some of the worst traffic in the country.

But what do I know? I am no billionaire CEO!!

Yes, I'm hearing "two new HQ split between Crystal City and NYC (or maybe Dallas)" but important to note that this is all speculation based one someone leaking info - Amazon has not issued any official statements on the issue yet at all.

HamsterStache

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #25 on: November 14, 2018, 10:11:58 AM »
Just wondering if, now that Crystal City and Long Island City have been made official, if it affects OP's question... Also wondering if this is going to affect my property values as we are situated within walking distance of DC metro (albeit one of the stops furthest away from the future Amazon location).

nkt0

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #26 on: November 14, 2018, 12:14:32 PM »
Just wondering if, now that Crystal City and Long Island City have been made official, if it affects OP's question... Also wondering if this is going to affect my property values as we are situated within walking distance of DC metro (albeit one of the stops furthest away from the future Amazon location).

25k jobs is a rounding error compared to the size of the DC metro market. It will likely have no noticeable impact outside of Crystal City.

HamsterStache

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #27 on: November 14, 2018, 03:37:33 PM »
Just wondering if, now that Crystal City and Long Island City have been made official, if it affects OP's question... Also wondering if this is going to affect my property values as we are situated within walking distance of DC metro (albeit one of the stops furthest away from the future Amazon location).

25k jobs is a rounding error compared to the size of the DC metro market. It will likely have no noticeable impact outside of Crystal City.

That's more or less my assumption.

BlueHouse

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #28 on: November 15, 2018, 12:42:18 PM »
Just wondering if, now that Crystal City and Long Island City have been made official, if it affects OP's question... Also wondering if this is going to affect my property values as we are situated within walking distance of DC metro (albeit one of the stops furthest away from the future Amazon location).

25k jobs is a rounding error compared to the size of the DC metro market. It will likely have no noticeable impact outside of Crystal City.

I'm not so sure.  I think the impact will be on higher-priced homes, and since there are fewer of those to begin with, it may inch those prices up.  I'm hoping there is increased demand for my home, since I'm on a metro (would require a transfer) and I'm in an area with really easy access to the freeway (so it's about an 8 minute drive to Crystal City) not to mention potential for water taxis and kayaks (already here on my side)

nkt0

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Re: Amazon HQ2 impact on real state. Should/when to buy?
« Reply #29 on: November 15, 2018, 01:48:41 PM »
I'm not so sure.  I think the impact will be on higher-priced homes, and since there are fewer of those to begin with, it may inch those prices up.  I'm hoping there is increased demand for my home, since I'm on a metro (would require a transfer) and I'm in an area with really easy access to the freeway (so it's about an 8 minute drive to Crystal City) not to mention potential for water taxis and kayaks (already here on my side)

Good point about the high end market. "Inch" is the correct term though. It will probably take 5-10 years to fully realize the goal of 25k new jobs. My guess would be that they will build tons of worker housing near campus like they have in Westlake/South Lake Union Seattle. Enough for everyone? Probably not. But DC is a much bigger place than Seattle and there will be far fewer jobs in Amazon HQ2 than in HQ1. I just can't see it really making a dent in the already crazy DC housing market.