Let's talk about what's happening with housing in Northern Virginia. If you're like me, you're probably wondering what all the buzz is about, especially with national headlines about the real estate market. The short answer? The Northern Virginia housing market is showing impressive resilience, actually outperforming national trends in 2024. It's definitely a market with its own unique dynamics, and I'm going to walk you through all of it so you can get a good grasp on what's going on.

Current Northern Virginia Housing Market Trends: A Deep Dive

Home Sales

First, let’s look at home sales. Nationally, existing home sales took a big hit in 2024, hitting their lowest level since 1995 with just 4.06 million homes sold. That's a pretty significant drop, but get this: Northern Virginia actually saw a 2.5% increase in the total number of homes sold! According to NVAR, sales went from 15,958 homes sold in 2023 to 16,357 in 2024.

This tells me there's definitely a strong and consistent demand for homes in our area. People really want to live here! Even more impressive, the total dollar volume of sales shot up by a huge 10.58%, totaling $13.84 billion in 2024. These numbers really paint a picture of a market that's defying national trends. In particular, for December 2024, the closed sales were 1,138 units in the area, an incredible 27.3% increase compared to December 2023. That’s quite a jump!

Home Prices

Now, let's talk about everyone's favorite topic – home prices. Nationally, the median home price hit a record of $407,500 in 2024. Here's the kicker: Northern Virginia's median sold price was significantly higher, reaching $729,710, which is a 7.31% increase compared to the previous year. This illustrates just how competitive the Northern Virginia market can be. In fact, the average sold price for December 2024 stood at $838,724, growing by 4.3% when compared to December 2023. Again, it looks like things are still pretty robust in our neck of the woods.

Are Home Prices Dropping?

This is the question on everyone's mind! Are home prices starting to drop? Well, the data suggests that, at least in Northern Virginia, they aren't seeing any dramatic drops right now. While the national average may show fluctuations, our region's December 2024 median sold price was $700,000. This represented a 3.7% year-over-year increase, and remained stable when compared to November 2024. So, while we’re not seeing massive price hikes, prices are also not falling significantly. It appears that while home prices aren't rising at the same rate they were a year ago, they're still holding strong in our area.

Comparison with Current National Median Price

Okay, let’s put this in perspective. The national median home price in December 2024 was around $404,400, showing a 6% year-over-year increase. Compare that to Northern Virginia's median of $700,000 in the same month, with its 3.7% year-over-year increase. The difference is significant! Homes in Northern Virginia are selling for a much higher price than the national average. Even with the slight slowdown in the rate of price increase, our region is still seeing significantly higher prices than many other parts of the country, underscoring the region’s desirability.

Housing Supply

Another key factor is housing supply, or the amount of homes available for sale. Nationally, inventory tightened to a 3.3-month supply in December 2024, a 13.5% drop from the previous month. Northern Virginia, however, has an even tighter supply at 0.8 months in December 2024. While this was an improvement over the 0.6 months supply of December 2023, it's still very low compared to the national figure. This means that there are fewer houses on the market, and that is creating competition, which affects prices. To add to this, the number of new listings in December 2024 was 551 units, which was below the five-year average of 856 new listings in the month of December. This is a key reason why the supply remains low and demand remains high.

Is It a Buyer's or Seller's Housing Market?

Given these dynamics, is it a buyer's or a seller's market? Well, with limited inventory and strong demand, it's still leaning towards a seller's market here. Homes are selling quickly, with an average of 27 days on market in Northern Virginia during December 2024, while the national average is a longer 35 days. This quicker sales pace means sellers often have the upper hand, as buyers have to make decisions fast and sometimes compete with other offers. For buyers, it means being prepared to move quickly and possibly make some compromises. It's important to have everything in place, including your pre-approval, and be ready to act fast if you find a property you love. It is important to have your real estate agent with you to help and advise.

Market Trends

So, what are the main trends driving the Northern Virginia housing market? Well, one of the biggest factors is the region’s strong economy and proximity to major employment hubs, such as Washington, D.C., and many defense and tech companies. This creates a consistent demand for housing. Secondly, the diverse housing options – from urban condos to suburban single-family homes – appeal to a wide range of buyers. Furthermore, the area's excellent schools, amenities, and high quality of life all contribute to its attractiveness. The numbers simply show the high demand in the region, with both the number of total sales increasing and the average home sale price increasing.

Here is a table to recap some important points:

Metric	Northern Virginia (Dec 2024)	National (Dec 2024)
Median Sold Price	$700,000	$404,400
Year-over-Year Change in Median Price	+3.7%	+6%
Average Days on Market	27 days	35 days
Housing Supply	0.8-month	3.3-month
Closed Sales (December 2024 vs 2023)	1,138 units (+27.3%)	Data Not Available
Sold Volume (December 2024 vs 2023)	$958,888,838 (+32.7%)	Data Not Available
Average Sold Price (December 2024 vs 2023)	$838,724 (+4.3%)	Data Not Available
New pending sales (December 2024 vs 2023)	809 units (+4.7%)	Data Not Available
Active Listings (December 2024 vs 2023)	1092 units (+10.8%)	Data Not Available

Impact of High Mortgage Rates Which Are Currently Hovering Around 7%

Let's not forget about mortgage rates. As of February 2025, they're hovering around 7%. These high rates definitely have an impact, making it more expensive for people to borrow money to buy a home. This also affects how much house a person can afford, especially with the high home prices in our area. It might lead some potential buyers to delay their purchases. However, despite these high rates, the Northern Virginia market continues to show resilience, meaning that while higher interest rates might slow some things down, they haven't stopped buyers from pursuing homes here. It is really a balancing act for both buyers and sellers.

My thoughts

In my experience as an observer of the real estate market, I’d say Northern Virginia is in a pretty unique situation. The consistent demand is not going anywhere anytime soon. I see a lot of people moving here for their jobs and careers, and that influx is not likely to stop. The higher home prices are also, to some extent, driven by the limited inventory, and that isn’t changing overnight. While the high mortgage rates can be a concern for buyers, many still choose to come in the market. Overall, it is a resilient and competitive market. It is best to work with an experienced realtor in the region to get personalized advice and see if the timing is right to enter the market, either as a buyer or seller.

Northern Virginia Housing Market Forecast 2025: What to Expect

If you're thinking of buying or selling in the area, you'll want to pay attention: the good news is that the market is expected to continue strengthening with moderate price increases and higher levels of activity. Think of it like a steady climb instead of a rollercoaster.

The Big Picture: A Strengthening Market

According to the Northern Virginia Association of Realtors® (NVAR), in conjunction with the Center for Regional Analysis at George Mason University (GMU-CRA), the 2025 forecast points towards a healthy and active housing market. This isn't just some random guess; it's based on a detailed analysis by a panel of real estate experts who have studied the market inside out. They looked at data like inventory levels, price trends, and broader economic factors. Essentially, they've done their homework, and we get to benefit from it!

Here's what's driving the positive outlook:

• Stabilizing Mortgage Rates: After a period of fluctuating rates, they're expected to stabilize, making it easier for buyers to plan their finances.
• Increased Inventory: The worst of the inventory shortage seems to be easing. While we won’t see a flood of homes, there should be more options available than in recent years.
• Continuing Job Additions: A strong job market in the region means more people are looking for housing, which supports demand.
• Move-up Buyers Return: More people who are looking to upgrade to larger homes are expected to start getting back into the market, which can also free up some inventory in more affordable price brackets.

It's important to note that although the market is strengthening, the price increases aren't expected to be as dramatic as we've seen in some recent years. For the most part, we're looking at moderate gains closer to 3%, with some pockets experiencing slightly higher increases.

Forecast by Jurisdiction

The forecast breaks down the information to the county level, so we can take a look at what to expect locally:

Fairfax County

• Single-family home prices are predicted to go up by a modest 1.5%.
• Sales of single-family homes are expected to increase by 5.7%. A welcome sign after some years of very limited choices.
• Townhomes inventory should go up by about 6.0%, this could ease the crunch a little for buyers looking for that “middle ground” option.
• Townhome sales are expected to increase, with prices rising as well ( 2.9% and 3.9% respectively).
• Condo price increases are set to slow down a bit, up 3.5%, but inventory should increase slightly, up 3.6%.

Category	Forecasted Price Change (2025)	Forecasted Sales Change (2025)	Forecasted Inventory Change (2025)
Single-Family Homes	1.5%	5.7%	Not Specified
Townhomes	3.9%	2.9%	6.0%
Condos	3.5%	Not Specified	3.6%

Arlington County

• Inventory of single-family homes is expected to increase slightly by 1.8%.
• Sales of single-family homes are actually expected to decrease by 6.5%, but the market is so small that the change in numbers is quite small.
• Despite lower sales, prices for single-family homes in Arlington are forecasted to jump by 5.3%, a sign that demand remains high, especially inside the Beltway.
• The demand for townhomes is also strong and the prices are projected to increase significantly by 8.7%.
• The market should see a slight inventory increase in townhomes of 4.3%.
• Condo prices are projected to increase by 1.6%, due to some cooling off compared to the last few years.

Category	Forecasted Price Change (2025)	Forecasted Sales Change (2025)	Forecasted Inventory Change (2025)
Single-Family Homes	5.3%	-6.5%	1.8%
Townhomes	8.7%	Not Specified	4.3%
Condos	1.6%	Not Specified	3.6%

Alexandria City

• The median prices of single-family homes are expected to surge by 9.9% which is quite significant. This could be impacted by return-to-office trends.
• Sales of single-family homes are set to contract further, with sales decreasing by 4.7%.
• Townhome prices will increase by 3.9%.
• Inventory of townhomes should increase by 5.2%.
• Condo prices are expected to rise by 1.5%.

Category	Forecasted Price Change (2025)	Forecasted Sales Change (2025)	Forecasted Inventory Change (2025)
Single-Family Homes	9.9%	-4.7%	Not Specified
Townhomes	3.9%	Not Specified	5.2%
Condos	1.5%	Not Specified	Not Specified

Prince William County

• Single-family home prices are predicted to increase by 3.5%.
• The inventory for single-family homes should remain largely unchanged with sales dropping by 1%.
• Townhome prices are set to increase by 4%.
• Townhome inventory is set to increase by 5%.
• Condo prices should go up by 6.2%.
• Both sales and inventory of condos should increase by 6%.

Category	Forecasted Price Change (2025)	Forecasted Sales Change (2025)	Forecasted Inventory Change (2025)
Single-Family Homes	3.5%	-1%	Not Specified
Townhomes	4.0%	Not Specified	5.0%
Condos	6.2%	6.0%	6.0%

Loudoun County

• Single-family homes prices are expected to increase by a substantial 5.5%.
• Sales of single-family homes are also set to increase by 4%, while the inventory goes down 1%.
• Townhomes prices should increase by 3.8%.
• Townhouse inventories are set to drop by 3%, with sales up just 1%.
• Condo prices are expected to go up significantly by 8.1%.
• Condo inventories should remain flat, while sales should go up about 2%.

Category	Forecasted Price Change (2025)	Forecasted Sales Change (2025)	Forecasted Inventory Change (2025)
Single-Family Homes	5.5%	4.0%	-1.0%
Townhomes	3.8%	1.0%	-3.0%
Condos	8.1%	2.0%	Not Specified

Stafford County

• Single-family home prices are projected to increase by 4.5%
• Sales should be up 2.2% with a 2.5% gain in inventory
• Townhome prices should see a solid increase of 3.5% with sales and inventories up as well
• Condo prices will go up 3.9%

Category	Forecasted Price Change (2025)	Forecasted Sales Change (2025)	Forecasted Inventory Change (2025)
Single-Family Homes	4.5%	2.2%	2.5%
Townhomes	3.5%	1.9%	3.7%
Condos	3.9%	Not Specified	Not Specified

My Thoughts and Opinions

As someone who’s watched this market closely, I believe these forecasts are reasonable and reflect the current trends. The shift towards more moderate price increases is a welcome sign for buyers, who were finding it increasingly difficult to compete in the past few years.

The growth of inventory is a good sign, but it won’t solve all the problems. Certain areas, like inside the Beltway, will continue to be very competitive. Buyers will need to come prepared with pre-approvals and be ready to act quickly when they find the right property. Also, I would pay close attention to the townhouse market. In some areas the price increases are quite significant.

For sellers, this still represents a great opportunity. While it might not be the frenzy we saw a year or two ago, well-maintained and well-priced homes will still attract multiple offers. You should definitely take advantage of this time.

I also think it will be very interesting to see the impact of the new presidential administration on the housing market as policy changes can shift the market quickly. Northern Virginia is so closely tied to the DC area that any change in the region will definitely impact us.

What This Means for You

• If you're a buyer: Get pre-approved for a mortgage and be ready to act quickly. Don’t get caught up in overbidding wars. Be patient. A good real estate agent will be invaluable during this time.
• If you're a seller: Price your home competitively and focus on showing it at its best. Don't leave anything to chance and get a good real estate agent in your corner.

Conclusion

Overall, the Northern Virginia housing market forecast for 2025 is a sign of stability and growth. While some areas will be more competitive than others, this forecast points to a healthy market that should work well for both buyers and sellers.

It's essential to stay informed and make decisions that are based on your personal circumstances and long-term financial goals.