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.
(more…)
