The median price of sold homes will continue its upward trend across Northern Virginia, but the rise in prices will slow down in the coming months, according to a new report from the Center for Regional Analysis at George Mason University (GMU-CRA) and the Northern Virginia Association of Realtors (NVAR).
“Through the second half of 2021, the median price of sold single-family homes in Arlington is forecast to increase an average of 16.4% year-over-year. The median price of Fairfax County single-family homes is forecast to increase year-over-year by 8.6%, on average, and by 7.4% in Alexandria at year’s end,” according to the report. “This is not a signal of comparative market weakness in Alexandria, but more likely reflects unique market dynamics and data artifacts given the relatively small size of the Alexandria market.”
Townhomes will also see price increases, though at a lower year-over-year percentage increase.
“From July to December 2021, the median price of sold townhomes is forecast to increase year-over-year an average of 6.8% in Fairfax and 3.5% in Alexandria while decreasing 2.4% in Arlington. Overall, Arlington townhomes will continue to be sold at elevated prices compared to long-term trends, however. The decrease reflects the unusually strong market at the end of 2020,” the report’s authors explained.
The condo market is a little bit more complicated: “Despite the large fluctuations in the condo market with increased inventory and pandemic influenced lower demand, the median price of sold condos across Northern Virginia will show increases this year but at more moderate levels compared to other housing types. Trend line forecasts suggest price increases ranging from 1.6% to 3.3%.”
Inventory, which is measured by the number of active listings at the end of any given month, will remain low for some housing types. There seem to be plenty of condos available for buyers, but there will be relatively few townhomes and single-family homes on the market.
Fairfax County, the largest jurisdiction in the NVAR region, is forecast to have only about 400 active listings of single-family homes in December, down from 2,674 in June 2015. Arlington and Alexandria are forecast to have just 71 and 17 active listings of single-family homes in December, respectively.
Of course, this could all change: The course of the pandemic is the biggest X factor in the housing market. “More subtly, the pent-up demand for travel has likely slowed the pace of buying and selling during summer months,” the report’s authors explained. “There may be an unexpected increase in activity if would-be buyers and sellers return from vacation ready to jump into the housing market. Another market factor to monitor is that households who refinanced or remodeled during the pandemic are likely to hold onto their properties longer, which could depress listings.”
View the full report here.
