In December 2025, the Northern Virginia real estate market seems like every other winter – slow and steady. By the end of the month, sale prices were down 1.5% from the previous month and up almost 5% from last year. This is a great return on investment for any homeowner. It’s taking longer and longer for home to go under contract and buyers are negotiating everything from closing costs to home inspections. This is likely due to mortgage interest rates that really aren’t going down. Here’s what it all means for the Northern Virginia Market Update for January 2025.
Mortgage Interest Rates
For the past few months, interest rates have been hovering between 6.5 and 7%. This month, interest rates are now above 7%. Only time will tell if and when rates moderate to encourage more home owners to sell and home buyers to keep shopping. Still these figures seem to be the new norm and the public is adjusting.
Statistics and What it Means
Using statistics from MarketStats by ShowingTime, we looked at 10 counties in Northern Virginia – Alexandria, Arlington, Fairfax, Falls Church, Fauquier, Loudoun, Manassas City, Manassas Park City, and Prince William. Here are the highlights for Northern Virginia.
The median sale price for a home in Northern Virginia at the end of October 2024 was $660,000, which is down 1.5% from the previous month and up 5% from the same time last year.
By the end of November, 1,992 homes in Northern Virginia were sold. This is down 16.5% from the previous month and up 9.7% from last year.
The number of Days on Market for Northern Virginia is now 23 days, this is 2 days more than last month and 5 days more than last year. It is taking a little longer to get homes under contract.
This month, there are 1,840 homes for sale, which is a 21% increase from last month and the same from last year.
Inventory Levels
The phrase “Month’s Supply” refers to how many months it will take to sell all the homes currently on the market. Most consider a balanced market, where buyers and sellers are on the same playing field, to be about 3-6 months supply. Currently, Northern Virginia has a month’s supply of homes for sale of 1.2 months. While inventory continues to be low, buyers demand is also not high.
Bright MLS Buyer Demand Index
According to Bright MLS Home Demand Index, buyer demand in the Washington Metro Area (which includes Northern Virginia) remains “Limited”. The Bright MLS | T3 Home Demand Index measures and tracks consumer and real estate professional behavior related to shopping for real estate. They look at metrics such as the number of views of homes online and in-person showings. Ratings are categorized into 5 score points: Limited (under 70 points), Slow (70-89), Steady (90-109), Moderate (110-129), and High demand (over 130).
For the month of December, buyer demand is now predominantly SLOW, which a level down from LIMITED last month. Here are the top 5 in Northern Virginia: SLOW in Alexandria (73) and Arlington (72) ; LIMITED in Manassas City (59), Prince William County (58), and Stafford (57). Loudoun County’s buyer demand is also LIMITED (37).
What Does This All Mean
The real estate market in Northern Virginia at the end of December is slow as expected for this time of the year of holidays, family gatherings, and winter weather. The start of January 2025 seems to be heading into an active Spring market as home buyers and sellers have adjusted to the new mortgage interest rates around 7%.
Advice to Sellers
For homeowners in Northern Virginia, note that more and more homes are coming on the market which means increased competition to get buyers through your doors and getting to the closing table. Proper pricing, preparation and stellar marketing are key components to a successful home sale.
Advice to Buyers
If you’re ready to buy a home, this may be the time to jump in. If you’ve been approved for a loan, it’s a great time to negotiate with homeowners before more buyers enter the market this Spring. Has anyone discussed the home buying process in Northern Virginia with you? If not, please reach out.
Bottom Line
The market update for January 2024 shows a more balanced real estate market where home shoppers and home buyers can come to mutually beneficial agreements. We look forward to keeping you informed every step of the way.
Questions/Concerns? Please contact us.
