Amazon is coming to town: Sequential information revelation in the housing market

Abstract This study demonstrates that the housing market can incorporate information quickly instead of slowly over time, using Amazon's gradual revelation of its new headquarters locations in Virginia and New York. Spatial difference‐in‐differences analysis shows that housing prices near the Virginia headquarters exhibit 4.9% premia months before the decision, while price premia for New York reach 17.5% before the decision but disappear upon cancellation. The absence of significant effects on transaction volume, construction, or price premia for other finalist cities rules out the possibility of speculation. Overall, this study provides a counterpoint to the commonly held belief that the real estate market is always slow to respond to information about future demand shocks.