WASHINGTON -- Amazon has yet to break ground in northern Virginia for its second headquarters, but residents are already turning away persistent speculators, recalculating budgets for down payments on homes and fighting rent increases.
Amazon announced in November that its second headquarters would be in National Landing, which includes parts of Crystal City, Pentagon City and Alexandria, all suburbs of Washington. The company will hire 25,000 people over the next 10 to 12 years.
"That day in November, I got more Zillow calls, inquiries and leads off of Zillow than I did the entire month of October," said Michelle Doherty, a real estate agent who focuses on south Arlington, an area that is expected to change a lot.
As of June, the median home price in Arlington County was on track to increase 17.2% by the end of 2019, according to a report by the Northern Virginia Association of Realtors and the George Mason University Center for Regional Analysis.
Speculators have begun asking homeowners to sell. Potential homebuyers, typically younger, are holding off buying to save more money for down payments. Low-income renters are worried about rising rents and about how they will afford basic necessities.
And Amazon has not even arrived yet.
James Younger, a homeowner in south Arlington for more than 30 years, received inquiries from speculators once or twice a year before the Amazon HQ2 announcement. Now, he gets inquiries at least twice a month.
"I'm certainly not going to sell it," Younger said.
Some real estate brokers have gone beyond mailers. Agents hosted a wine-and-cheese event, with massages, in the community room in Erica Le Blanc's town-home building in Crystal City.
"Amazon is just speeding up the development timeline," said Le Blanc, who expects to see more restaurants in her neighborhood because of Amazon.
Christian Dorsey, chairman of the Arlington County Board, was careful to note that he did not believe Amazon was directly responsible for the spike in home prices and cautioned that rent increases were typical for the area. "Whether or not the rent increases the people have experienced recently are the result of Amazon, or just the normal demand in the housing market, we don't know yet," he said.
But low-income residents in northern Virginia are worried. Amazon first began in Seattle in 1994, and since then, highly paid workers moving into the region to work at the company have driven up home and rental costs in the area. Homelessness rates have skyrocketed.
Arlington is already one of the most expensive places to live in northern Virginia, largely because of its proximity to Washington, and many residents fear that it could now go the way of Seattle. "The fact that we're going to have 25,000 more jobs in Arlington is just likely to make it even more difficult for someone who doesn't have a large income to live in Arlington," said Christine Richardson, a board member of the Northern Virginia Association of Realtors.
Gloria, a housekeeper who has lived in Arlandria, a neighborhood in Alexandria, for more than 13 years, has already seen rent increases. The increases have made it harder for her to afford basic needs like food, clothes and shoes for her daughters, who are in the sixth and seventh grades, and herself.
"Before in the past, every time the rent were to increase, it would only increase around $15 monthly," said Gloria, who asked that her last name not be used for fear of retaliation from her building's management company. "But now they increased it up to $75." She thinks the Amazon announcement prompted the increases.
Gloria has been working with Ingris Moran, the lead organizer for Tenants and Workers United, a grass-roots nonprofit organization in Arlandria that works with low-income immigrant communities, to stop her building's management company from again raising the rent during this lease period.
Moran said she was nervous about such increases. She grew up in Arlandria and lives with her husband and her parents in a one-bedroom apartment that has a den. The rent, including utilities, can reach up to $1,700 a month.
"My neighbors, most of them have two to three jobs, and they are earning much less than me, and they still have children so I can just imagine how they're struggling when I'm struggling myself," Moran said.
Virginia, Alexandria and Arlington County have all increased their housing budgets for 2020, in part because of the Amazon announcement.
The Virginia General Assembly approved $9 million annually for the Virginia Housing Trust Fund, which is an extra $3.5 million in funding. Arlington County budgeted $16 million for the Affordable Housing Investment Fund and $9.3 million for Housing Grants, a rental subsidy program. That is roughly $1 million in additional funding for both the Affordable Housing Investment and Housing Grants.
Amazon counters that its second headquarters will not have the same effect in the Washington region as its first headquarters had in Seattle.
"One of the things that drew us to this location was the plans the county and the commonwealth have in place to address this issue," said Brian Huseman, a vice president for public policy at Amazon. "We also plan to grow gradually and hire people who live here to help reduce the impact on the region."
Business on 07/11/2019
Print Headline: Virginians fear Amazon effect on housing costs