This regularly-scheduled sponsored Q&A column is written by Eli Tucker, Arlington-based Realtor and Arlington resident. Please submit your questions to him via email for response in future columns. Enjoy!
Question: I’ve read that home prices in Arlington are up since the Amazon announcement so I’m trying to decide if I should go ahead and sell my home now or if it makes more sense to wait for more appreciation when Amazon employees start to arrive. What is your recommendation?
Answer: Amazon’s decision to move HQ2 to Arlington has made an immediate impact on the local housing market and many home owners are asking whether or not they should sell or hold. As with most real estate decisions, the answer is… it depends.
It depends on your personal goals and circumstances, but the good news is that you’re likely going to be happy with either decision. Here are a few points to consider that are relevant to the market we’re currently experiencing:
Why You Should Sell Now
1. Highest One-Year Appreciation? — My guess is that 2019 will be our highest one year appreciation over the next decade barring some other major corporate news. While I do expect Arlington to experience steady growth over the next ten years from Amazon and the “Amazon-effect,” I don’t think the impact will be as extreme as many people fear/hope (see excellent analysis by the Stephen S Fuller Institute).
If you’re holding out for 40-50%+ returns over the next 5 years, I’d reconsider your strategy.
2. Better Application of Equity — I think this is the most important, and most personal, reason to sell. If you can improve the quality of your life with the equity you have in your home (early retirement or larger home) or you have a more productive application of that equity (start a business or re-invest), selling now might make a lot of sense.
3. Looming Economic Downturn — There’s always somebody warning of the next economic doomsday, but consensus seems to be building that we will face an economic downturn within the next two years. The potential for an economic shift is much more important if your decision is between selling now or 2-5 years from now vs selling now or 10+ years from now.
4. Your House Needs Work — Supply is so low right now, and demand so high, that sellers can command premiums on their home even if it’s lacking in updates or curb appeal that may have made a sale difficult in the past.
5. Condo/Townhouse Owner — Condo and townhouse inventory is down over 50% in each of the last two quarters compared to the prior year, a significantly higher drop-off than single-family homes.
Over time, the County should be able to facilitate more supply of condos and townhouses through up-zoning so this may be the best time to sell yours, especially if you own a two-bedroom where year-over-year inventory is down about 60% the last six months.
Why You Should Not Sell Now
1. Long-term Growth — It’s hard to imagine a scenario where there isn’t steady, long-term growth in Arlington and the surrounding communities over the next ten years as more private businesses file in behind Nestle and Amazon. Combine that with Arlington’s resiliency to economic downturns, it’ll be hard to find another real estate assets with a better risk/return ratio.
2. Investment Property — Converting a primary residence into an investment property can be a great way to improve your investment portfolio as long as it doesn’t hinder your new living situation
3. Net Gain or Loss — If you plan to move locally into a larger, more expensive home then it’s likely that the market forces allowing you to sell faster and for more money will work against you on a larger scale as a buyer. On the flip side, this may be the best time to downsize. Determine what the likely net gain or loss of a simultaneous sale/purchase will be.
4. Amazon Isn’t Here Yet — This is probably the most obvious reason, but Amazon employees haven’t started adding to the demand yet and the true impact of their buying power, plus the impact of new development, probably won’t be felt for another 4-5+ years.
5. Single-Family Home Owners — Yes, the single-family market is extremely competitive right now and we’ve seen some impressive prices, especially in South Arlington, but I don’t think this is the peak single-family market yet. Available inventory has “only” dropped by about 25% since last year, about half of the drop seen in the condo and townhouse market, and unlike condos and townhouses there’s nothing the County can really do to facilitate more single-family housing supply because we simply don’t have the space.
While supply will remain the same, I expect demand for single-family housing to increase as Arlington’s wealthy Millennial population trades bar crawls for baby crawls and Amazon employees prioritize short commutes.
These are far from the only reasons you should decide to sell or hold a property right now in Arlington, but many of the reasons come down to specifics on your property and your goals. If you’d like to discuss this decision, don’t hesitate to reach out to me at [email protected] for a meeting.
If you’d like a question answered in my weekly column or to set-up an in-person meeting to discuss local real estate, please send an email to [email protected]. To read any of my older posts, visit the blog section of my website at www.EliResidential.com. Call me directly at (703) 539-2529.
Eli Tucker is a licensed Realtor in Virginia, Washington DC, and Maryland with Real Living At Home, 2420 Wilson Blvd #101 Arlington, VA 22201, (202) 518-8781.
A 3 BD/2 BA home with an oversized kitchen, renovated bathrooms and wrap around deck is included in Just Reduced.
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Let the Arlingtones surprise your friend or sweetie this Valentine’s Day with a barbershop quartet singing love songs in four part a cappella harmony! Choose from a small selection of songs in our repertoire to surprise your special someone.
$75 for two songs delivered to a place of your choice by a live, in-person quartet. Includes a classy tin of chocolates, fresh red rose and personalized card. Small mileage surcharge for >5 miles outside Arlington VA.
$30 Facetime/Skype valentine- two songs delivered ‘live’ via Facetime or Skype at an agreed-on time.
$20 virtual valentine- two pre-recorded quartet songs delivered via email with a personalized message.
Have you noticed a striking sculpture at Monroe Street and Wilson Boulevard? It’s the Museum of Contemporary Art Arlington’s newest installation, Make Your Mark, by Arlington artist, Adam Henry. This sculpture celebrates MoCA Arlington’s rebranding and brings the museum’s energy outdoors.
On February 11, come inside when the museum’s galleries reopen with two new exhibitions: Rebecca Rivas Rogers: Grey View and Crisis of Image.
Grey View, in the Wyatt Resident Artist Gallery, is an homage to “gray” and a snapshot of the artist’s process. Consisting of photographs, collage, and a site-specific installation, this show is an outgrowth of Rivas-Rogers’ visual investigations into places you see on your way to somewhere else.
On the main level, Crisis of Image features artists who seek equity in today’s saturated visual world by developing new methods related to the production of images.
Valentine gifts for someone special or for yourself are here at George Mason University from noon -4pm on February 14, 2023. Satisfy your sweet tooth with Kingsbury Chocolates, find a handmade bag from Karina Gaull, pick up treats from Village