Question: Has there been an increase in the number of homeowners putting their home on the market after Amazon’s decision to move to Arlington?
Answer: For me, this was the big unknown — would the announcement of Amazon HQ2 cause homeowners to quickly put their homes up for sale to take advantage of a higher resale value or would those owners decide to hold on for the mid/long run, hoping for a much greater return 5-10+ years from now? The early data in Arlington and Alexandria suggests a preference for the latter.
New Listings Way Down
The easiest way to answer the question is to look at the Year-over-Year change in the number of new listings to hit the market each month. Over the last three months, the YoY difference in new listings in Arlington has been -11%, -18.4%, and -13.9%. The City of Alexandria has followed a similar pattern.
Months of Supply…Also Way Down
Months of Supply is a supply/demand reading that tells you how many months it would take for all the homes currently on the market (supply) to sell, given the current rate of sales (demand). Economists generally consider six months of supply to represent a well-balanced real estate market for both buyers and sellers. Arlington and the City of Alexandria have hovered around 2-3 months of supply for most of the past 6-7 years, having never dropped below the one-month mark for 10+ years…until December 2018, when the two combined to average about .75 months of supply each of the last three months.
What Does This Mean For Northern VA?
You can shield the Seven Kingdoms from White Walkers by stacking up all of the frustrated buyers searching in Arlington and Alexandria. Some may decide to pass on buying a home and continue renting, find a way to make their existing homes work, or move out of the area altogether, but many others will start to look further west for value (it’s there, trust me). Expect to see an immediate spillover into Annandale, Falls Church, and Springfield; that shift has already started with many of our clients.