Good Afternoon
Good Afternoon
ClassifiedsReal Estate

Will Amazon move will be prime for Long Island housing?

Brandon Savastano, who has had a home in

Brandon Savastano, who has had a home in Great Neck on the market since June, says he does not see Amazon's planned move to New York playing a large factor on the Long Island real estate market. Credit: Linda Rosier

When Amazon announced that one of its choices for a second national headquarters would be Long Island City in Queens, the news was a stunner. Obviously, the real estate market in the redeveloped industrial area with its sweeping views of Manhattan will be dramatically affected in the next few years, primarily from the 25,000 new employees who will be stuffed into local apartments, coops and condos.

But the impact on the housing market in outlying areas such as Long Island with its suburban trifecta of homes, parks and beaches also looks promising, say real estate experts and those with long experience in the field almost two months since the announcement.

"We're doing good now and I think Amazon is going to do even better for us," says Edna Mashaal, owner of a Great Neck real estate firm.

Past is prologue, historians say, so taking a look at what happened in Seattle when Amazon was founded there in 1994 might be one way of forecasting what could happen here. There is no doubt, for example, the internet behemoth changed things for the better, says Matthew Gardner, chief economist with the Windermere Real Estate, the largest privately held regional brokerage on the West Coast.

The same should happen in New York, he says.

"Ultimately, it will be positive economically," he says. "And some of it will flow in your [Long Island's] direction."

Most of the Seattle workers (and probably the ones coming to New York) tend to be younger and enjoy hanging out together in the Amazon "campus" of office buildings, he says. This kicked up prices for apartments, condos and coops in the area and forced at least some percentage of workers out to the suburbs.

Gardner says figures are hard to come by, but it is known the number of workers has risen enough that a couple of years ago Amazon initiated a shuttle system to help transport them into the city.

How many settling in New York might break away from the pack and head to the suburbs also is unknown, but Gardner points out that millennials are getting older, with some probably considering having families. This makes buying a home and checking out schools more appealing, even if it requires a commute.

If that does happen, he says, expect a gradual rise in home prices. Excluding figures from the East End, recent data pegged the median price of a home on Long Island at $450,000.

"It's not like turning on a light switch. The effect isn't going to be immediate, but over time you'll see slightly higher prices than would be expected naturally."

Others who see a rosy scenario for the future are real estate agents, especially because Amazon is promising to invest $2.5 billion in the headquarters and employing workers boasting an average salary of $150,000.

"A lot of home sellers are excited about what's going to happen," says Yadlynd Cherubin-Eide, a licensed real estate salesperson with Keller Williams. News of the move has given some of her clients on the fence the confidence to put their homes on the market, she says.

"People who have been toying with the idea of retiring or moving are starting to do some serious planning," she says. "They're saying, 'You know what? We're going to do this.'"

One of those who has definitely noticed an impact is Sydney Sawyers, owner of Sawyers Premier Realty based in Elmont, whose territory stretches from Queens across the border into Nassau County.

Elmont remains a natural draw for Queens residents looking for good suburban neighborhoods and schools, he says. But the Amazon announcement -- along with the proposed renovations for mixed-use developments at Belmont Park that would add a new arena for the New York Islanders hockey team  -- has made the area even more attractive.

"I've definitely seen an uptick in housing prices," he says. "And rentals are off the charts."  

One-bedroom apartments that would have fetched $1,200 to $1,300 per month a year ago now are going for $1,500 to $1,600, Sawyer says. And two-bedroom units that would have rented for $1,600 to $1,700 last year are commanding prices anywhere from $1,800 to $2,000.

He doesn't advise his clients to hold back selling their homes in anticipation of rising prices, but many homeowners he talked to have made that decision on their own after seeing what's happening around them. 

For example, right now there are about 100 homes for sale in Elmont, he says. Normally, there are twice that many on the market. "Housing prices have gone up and people are still snapping them up," he says.

Alex Rubin, a real estate broker with Douglas Elliman in Long Beach, says he believes most of the influx of Amazon workers will remain close to their work site, just as most analysts predict. But he also sees trendy communities such as Long Beach, Huntington and Great Neck siphoning off a certain percentage because of restaurants and entertainment venues. "We have tons of bars in the West End, which makes Long Beach one of the Island's hottest areas right now," he says. "I can also see young people moving here for the beaches."

Although he says he thinks speculation about the influx may be premature, Peter Caputo, owner of ERA Caputo Realty in New Hyde Park, is ready if the Amazon wave does materialize. 

New Hyde Park -- one of the first stops on the Long Island Rail Road coming out of Manhattan -- could be an attractive choice for the new workers, he says. "We're a hop, skip and a jump from the city and the airports," he says.

Mashaal, owner of Edna Mashaal Realty in Great Neck, says she is definitely expecting a positive market effect and perhaps a jump in home prices. Still, she says she is not advising clients to wait around expecting to get more money for their home. The reason is that mortgage rates could rise and wipe out any future profit, she says. Mortgage rates peaked last October at 5 percent and have been trending lower in the new year 

Although news of the influx of potential buyers has buoyed home sellers, Brandon Savastano, 26, who has had a split-level home in Great Neck on the market since June, has what he believes is a more realistic  view. "I don't see it playing a large factor here," says Savastano, a business development executive with a commercial fire detection company based in Port Washington.

Reports are that it will be a couple of years before ground is even broken on the Long Island City facility, and that the projected 25,000 workers will be added slowly -- not in one lump sum -- to the market between now and 2028, he notes. On top of this, Savastano says he believes that the new federal $10,000 cap on deductible property taxes actually could start slowing sales on Long Island, especially in high-income areas.

"I'm not a pessimist. I'm not an optimist. I'm a realist," he says. "I just don't see the impact."

That is in line with recent statistics from the Multiple Listing Service of Long Island that showed sales activity slowing in Nassau County compared to last year, although still increasing slightly in Suffolk.

But Bruce Levine says he is pleased to see renewed interest recently in his three-bedroom, two-bath Contemporary in Long Beach, which has been on the market for the last two years. How much of it has to do with the Amazon move, if at all, is hard to tell, he says. "It's definitely a boost for the area and a positive for us," says Levine, a salesman who knows how to make the pitch for his own home, especially with the ocean only 150 feet away.

When it comes to crystal ball gazing, Jonathan Miller, chief executive of the Manhattan appraisal firm Miller Samuel and author of the monthly Douglas Elliman reports on real estate conditions, is more circumspect than most.  Certainly, there will be a real estate surge in Long Island City and nearby urban environments. But he envisions more of a "ripple" effect for outlying areas rather than a coming tsunami.

"I hate that game where people overstate the impact," he says. "It's going to be a good thing for the metropolitan area in terms of the economy. It's going to create a challenge to find affordable housing and that may push demand out toward the suburbs. So it's still a net positive."

Latest Long Island News