(NEW YORK, NY) — Amazon’s move to Long Island City poses an array of outstanding questions about both the current and future state of New York City’s residential market. As we put into perspective the addition of 25,000 new daily workers, commuters, and potential residents, change to the surrounding areas is inevitable.
In a comprehensive study done by PropertyShark, experts weighed in on how Amazon’s new headquarters will impact the residential market in Long Island City, Queens, Brooklyn, and New York City. What they found may deem Amazon’s presence more troublesome to current residents than beneficial.
PropertyShark calculated median sale prices based on residential property sales closed between January 1, 2018 and November 30, 2018. The residential properties included in the statistics are single-family homes, condos, and co-ops.
Since Amazon’s focus on Long Island City piqued the public’s interest, real estate marketplace, Point2Homes.com, reported that views on their Long Island City listings page nearly tripled. We’re talking a 198% increase since November 12, according to PropertyShark.
So, what do experts predict? PropertyShark found that the growing interest in Long Island City homes will result in a drastic increase in the rate at which the property prices grow. The same holds true to surrounding neighborhoods that run along subway lines that provide easy access into Long Island City.
Now, Long Island City has seen a rise in home prices well before Amazon’s decision to move there. Over the past five years, median home sale prices increased 35%. Currently, the median sits at $350,000, but PropertyShark suggests that Amazon’s move will cause that number to increase at a much faster rate. The same goes for Hunters Point, where median home prices are expected to reach $1 million in the foreseeable future.
Subway lines also hold a major stake in the coming wave of gentrification and new developments. A mass transit system was one reason why Long Island City stood out to Amazon. Consequently, rising property prices around specific lines are expected.
One subway line in particular, the 7, may have many Queens residents biting their nails. Not only will subway rides become more congested, but bordering neighborhoods with direct access to the line will see an increase in property prices.
As reported by PropertyShark, neighborhoods that are currently considered affordable will likely see a rise in price due to the 7 train’s direct access into Long Island City. These neighborhoods include Jackson Heights, Elmhurst, Corona, and Downtown Flushing. The study also suggests that prices will continue to rise in neighborhoods along the R, F, and E lines since they will also provide access to Amazon’s new headquarters.
“Until now the 7 train and the communities surrounding its stations haven’t really seen the gentrification and increase in price that other lines like the N, E and F serving Queens or any of the lines serving Brooklyn, even if commutes into Manhattan were significantly longer on those lines. Suddenly the 7 train is going to be discovered. Prices are going to swing in the other direction, from relatively affordable (for NYC) to very high,” said real estate investor and founder of PropertyShark, Matthew Haines.
Brooklyn neighborhoods along the G line are also expected to see an increase in prices. PropertyShark explains that the already pricey neighborhoods will continue to become more expensive. Greenpoint’s current median home sale price surpasses $1.1 million and is expected to go up. Home prices in Williamsburg, Bedford-Stuyvesant, and Clinton Hill are also likely to increase at a more accelerated rate than previously expected.
“Prices along various subway lines are going to rise by 25-40%. Neighborhoods that have been stable for generations are going to get gentrified and existing residents pushed out,” said Matthew Haines.
As reported by PropertyShark, neighborhoods to monitor are those that provide easy access to Amazon’s new headquarters, as these are where the most apparent upward spikes in property prices are predicted.
Another factor to keep in mind is the rise of new developments near Amazon. As reported by the company, new jobs at the headquarters will have an average annual salary of $150,000. New developments, particularly residential developments, are expected to cater to the changing area.
As we said before, this is merely speculation. In the words of PropertyShark, “One thing is for certain though: rising rents, home prices and living costs will lead a wave of gentrification and new developments.