How has the 'Amazon effect' impacted the local housing market?

Two separate reports examine what's happened since the HQ2 announcement

How has the 'Amazon effect' impacted the local housing market?

It’s been a year since Amazon announced the locations for its second national headquarters, dubbed HQ2.

Originally two locations – in Arlington County, VA; and Queens, New York – the firm later decided to pull out of the Queens location and focus on Virginia.

But since the announcement, how has the housing market in Arlington County and the wider Washington, DC metro, been affected?

Two separate organizations have analyzed sales and prices in the markets surrounding the Amazon HQ2 and published their findings this week. says that massive inventory shortages, sky-high price spikes and a blistering pace of sales are now the norm in the metro surrounding Amazon's second headquarters.

Its research finds that home sales in the market jumped 21% following the announcement (year-over-year) while prices jumped 17% - and have continued higher. The median listing price in Arlington County reached $863,000 in October 2019, up 33% year-over-year.

It also reports a 49% drop in active listings in Arlington County year-over-year, driving homebuyers to outer areas in Northern Virginia, which is made up of 14 counties, where active listings are down 26% year-over-year.

Because of the huge amount of attention on the Amazon announcement, investors flocked to the market, tightening supply.

"The 'Amazon effect' has branched out of its home base of Seattle and it has clearly stamped its fingerprint on the Northern Virginia housing market. The impact of the company's expansion in the suburbs of Washington, D.C. diverges along homeownership lines, with homeowners experiencing noticeable equity gains and buyers feeling the sting of higher prices," according to George Ratiu, senior economist at®.

But is it a boom?
CoreLogic has also provided an analysis of the market and found that the district housing market including Washington-Arlington-Alexandria and Silver Spring-Frederick-Rockville metro divisions, saw little growth in home value following the announcement.

The comparison is based on the CoreLogic HPI from September 2018 to September 2019, the most recent months that year-over-year comparison is possible). It shows a 3.4% gain for Washington-Arlington-Alexandria; and a 2.1% gain for Silver Spring-Frederick-Rockville.

While a long way short of a boom, when compared to the national trend, these markets were outperformers. National prices fell in the September 2018 to September 2019 period by 2 percentage points to 3.5%.

And, a zip code analysis compared with the CoreLogic HPI shows that, by September 2019, the zip codes closest to HQ2 have seen faster home price appreciation on average, than those near the fringe.


“While we don’t know precisely how the placement of a large corporate headquarters into a region affects a housing market, our work looking back on the first year of HQ2 suggests the potential for large upward swings in home prices near the chosen site. What’s more, the impact appears to take hold rather quickly, as investors and owner-occupiers bid-up home prices in anticipation of future tangible demand.”