When Amazon Moves In: An Analysis of Home Price Trends in Northern Virginia and the D.C. Metro Area

Abstract

In November 2018, Amazon announced plans to establish its new headquarters (HQ2) in Crystal City, Arlington, Virginia and Long Island City, Queens, New York City. Shortly thereafter, plans in Long Island City were cancelled, and Arlington, Virginia became the singular future site of Amazon HQ2. In this paper, I use housing market data from Northern Virginia and the larger Washington, D.C. metropolitan area. I analyze the relationship between home sale price and time before and after the Amazon HQ2 announcement using a linear spline regression model, checking against results of a lowess regression. To visualize the relationship spatially, I estimate a ratio to represent the difference in these trends before and after the HQ announcement. Mapped results indicate an increase in home sale trends in areas surrounding Amazon’s future location, but even more so in other zip codes within the D.C. metro area. However, I hold off on forming strong conclusions based on inconsistencies between the regression analyses.