Washington DC Is Luring Top Tech Companies. Is Now the Time To Invest in Real Estate?
“With massive companies such as Amazon, Facebook, Google, Yelp, Microsoft and Apple coming to the DC area there will be even more demand and price insulation in the market place “This will give even more confidence to an area historically that continues to thrive. ”
—Samer Kuraishi, President & Founder of The ONE Street Company.
As we all know, Washington, D.C. and its surrounding suburbs are already home to extremely popular housing markets. Now, with several top global companies coming to town (or expanding their presence), we might be looking at some large changes in the housing market (we recently discussed these possible changes here).
The Washington, DC metro area has historically been quick to build and increase housing as needed to meet the housing needs of its residents. However, housing markets like DC that are already so highly developed into their suburbs might have difficulty responding to so many new employers coming in over such a short period of time.
First: Who Exactly Is Coming to Town?
After over a year of anticipation, the DC suburb of Arlington, VA won half of Amazon’s second headquarters in 2018.
Its forthcoming hub is known as National Landing, a newly named area that that includes Crystal City, part of Pentagon City, and a portion of the Potomac Yard area. Amazon plans to invest $2.5 billion, create 25,000+ high-paying jobs, and occupy four million square feet of office space — with the possibility of expanding even further in the near future.
In 2018, Microsoft made a major investment in Loudoun County, VA. The company, one of the world’s largest tech powerhouses, acquired 332 acres of the Compass Creek development site for the cool price of $73 million.
Although the tech conglomerate hasn’t revealed many details about plans for the land, most of Loudoun County’s largest land sales in recent years have been earmarked for data center projects. The county, an up-and-coming area west of Washington, DC, has been creating buzz for itself as one of the world’s top data center markets.
Facebook and Washington, DC have shared news headlines for some time now, often when the social media giant comes to town to discuss issues of privacy law.
Many people don’t realize the company also has a newly-opened D.C. office that somehow remained largely under the radar.
Facebook has quietly more than tripled its D.C. presence, with a 73,0000 square foot lease at Terrell Place, where it moved in early 2018. The newest office of the social media trailblazer is located across from the Capital One Arena at one of DC’s busiest intersections.
Though nothing has further has been officially announced, the company appears to be beefing up its Washington-area team, particularly as the federal government ramps up its scrutiny of Facebook. Jobs will likely be in the areas of public policy, engineering, legal, security, facilities, and communications.
In 2018, the doors opened up at online reviews site Yelp’s newest East Coast office, right in the heart of Washington, DC. The 52,000-square-foot D.C. office is located right next to Capital One Arena in the Penn Quarter neighborhood.
This change saw a number of existing Yelp employees relocating to the District. The San Francisco-based giant has pledged to create 500 jobs in the District over the next five years — and at least half of the new jobs are guaranteed to go to DC residents.
No Signs of Slowing Down
These tech heavy-hitters are just a few of the confirmed companies who have chosen Washington for their newest (and sometimes biggest) locations — indeed, Google and Apple will continue to expand in the area, too.
In all likelihood, DC’s thriving technology community, talented and educated workforce, and close proximity to other East Coast cities will keep drawing truly global companies.
So what will happen to the local housing demand now that DC, already a popular housing market, will see such a spike in population?
If You’re Looking To Invest in Real Estate, Now Could Be the Perfect Time
Because Amazon and other huge companies will soon be either arriving or expanding, it will likely 1) inspire renters who had been on the fence about investing in real estate to pursue home ownership, and 2) bring new talent to town who will need a place to live, many of whom will decide to buy.
Prices are gradually increasing in many markets, but at the moment mortgage rates remain relatively low. Meanwhile, lenders are offering a range of low down payment options.
If you’re a prospective homeowner and you’re concerned you haven’t saved quite enough for a down payment, you might consider down payment assistance grants and other programs.
Amazon has laid out its pain to construct its new headquarters in phases, with the $5 billion investment spread out over a period of up to 17 years. The company soon hopes to have 500,000 square feet and 1 million square feet of office space ready, possibly within a year’s time.
This means we can likely expect a jump in rents and home prices in the areas surrounding the new headquarters and within a reasonable commuting distance. Investors and landlords alike have likely been trying to stay ahead of what could very well be a spike in housing prices — we urge you to do the same and consider investing in that home you’ve had your eye on.
Are you thinking of becoming a Washington D.C. area homeowner? When you need a dependable realtor, contact us. We’re very proud to be ranked #1 in the Washington D.C. metropolitan area for volume and units sold.