The housing market in Northern Virginia remains strong. The Northern Virginia Association of Realtors® reports on home sales activity for Fairfax and Arlington counties, the cities of Alexandria, Fairfax, and Falls Church, and the towns of Vienna, Herndon, and Clifton. The Northern Virginia housing market experienced a decline in home sales during April 2023, according to the Northern Virginia Association of Realtors® (NVAR).
Sales were down by 33.6% compared to April 2022, consistent with previous months. However, there was a modest increase of 3.6% in closed sales from March, which is encouraging for the local market. Ryan McLaughlin, CEO of NVAR, highlighted that this increase aligns with the typical spring trend of rising demand.
Despite the decrease in sales activity, home prices in Northern Virginia have remained remarkably steady. In April 2023, the median sold price reached $690,000, representing a 0.7% increase from the previous year. This continued price growth can be attributed to the combination of limited inventory and strong demand. While the limited inventory poses challenges for buyers, it acts as a protective factor for sellers, preserving their home values in a potentially volatile market.
The average days on the market increased by 63.6% from April 2022 to April 2023, reaching 18 days. This extended timeframe provides buyers with more opportunities to carefully consider their options and negotiate with sellers. Arshia Kia, a member of NVAR's Board of Directors, emphasized that the current market conditions offer a healthier and more predictable environment for buyers.
Realtors® can effectively advocate for their clients' interests and engage in problem-solving to facilitate the home-buying process. Analyzing the data from NVAR, the number of closed sales in April 2023 was 1,430 units, reflecting a 33.6% decline compared to April 2022 but a 3.6% increase from March 2023. The volume of sales amounted to $1,132,323,895, down 29% from the previous year but up 6.4% from March 2023.
The median sold price in April 2023 stood at $690,000, demonstrating a 0.7% increase from April 2022 and a 3.8% increase from March 2023. The average days on the market increased by 63.6% compared to April 2022. Active listings in April 2023 numbered 1,353, representing a 17.4% decrease from the previous year.
Will the Northern Virginia Housing Market Crash: Forecast for 2023
According to the 2023 Northern Virginia Association of Realtors (NVAR) Residential Market Forecast, the housing market will continue to experience a slowdown due to the rise in mortgage rates that began in the spring of 2022. The forecast team expects that the recession may start in mid-to-late 2023, which will further depress the market.
However, pent-up demand will maintain the market as a seller's market, with demand remaining soft compared to the previous two years. Home inventories will get tighter, as owners stay in their homes with refinanced loans below 3%, leading to a decline in unit sales by low double digits. Prices are expected to remain stable, with a modest increase of less than 1% on average.
In Fairfax County, the market for single-family homes is expected to remain flat, with a 0.4% price gain in December 2023 compared to December 2022, and a total unit sales drop of 9.7% due to tight inventories. Townhome unit sales will decrease by 15%, and prices will remain stable, with a small expected increase in median prices of 0.4%. Condominium prices will remain flat, with unit sales decreasing by 11% on the year.
However, condo inventories are expected to rise, as labor market forces are starting to influence some condo owners that are boosting interest in selling. In Arlington County, single-family home prices will rise at a slower rate than in previous years, with a 3% increase in December 2023 compared to the previous year. Unit sales will decrease by about 6%, and inventories will continue their multi-year drop. Prices for Arlington townhomes will remain flat, while inventories decrease.