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2025 NVAR Regional Housing Market Forecast

12/17/2024

NVAR Predicts 2025 Northern Virginia Housing Market will Continue to Strengthen with Higher Levels of Market Activity and Growth in Housing Inventory 

Each year, the Northern Virginia Association of Realtors® (NVAR), in conjunction with the Center for Regional Analysis at George Mason University (GMU-CRA), issues a consensus forecast for the NVAR region’s housing market. The Association convenes a panel of key experts from differing sectors of the real estate industry to review preliminary forecasts developed by GMU-CRA economists and offer their insights into current and near-future market conditions. The following represents the forecast team’s 2025 outlook. 

The Northern Virginia housing market will continue to strengthen with moderate price increases and higher levels of market activity. Northern Virginia’s outlook is similar to the national 2025 housing forecast that predicts the worst of the housing inventory shortage is ending, mortgage rates are stabilizing, and job additions are continuing, according to the National Association of REALTORS®.  

Other hopeful signs for the region’s economy and housing: 

  • Most markets will see more moderate price gains than in 2024, closer to 3%, with some higher levels of increases in tight markets — such as single-family homes inside the Beltway. 

  • Sales activity will increase with modest improvements in the region’s inventory. 

  • While still below pre-pandemic levels, most market segments in the region will see more homes for sale as move-up purchasers re-enter the market. 

  • Stability in mortgage rates will support higher levels of sales, as the market acclimates to higher, but more historically normal mortgage rates. 

There are still some undetermined factors that may affect the region’s housing market. The promises made by the incoming administration during the presidential campaign may have an impact on the Northern Virginia housing market, which is a large submarket of Washington, D.C. The timing and magnitude of any government policy changes are unclear at this time. 

NVAR’s 2025 Regional Housing Market Forecast includes Alexandria City and Arlington, Fairfax, Loudoun, Stafford, and Prince William Counties. Below is data for each jurisdiction. 

Forecast by Jurisdiction 

Fairfax County (View Charts

  • Single-family home prices are expected to rise 1.5% during 2025. 

  • Total unit sales for single-family units are forecasted to increase 5.7% in 2025 compared to 2024, a welcome change after several years of tightening inventories. 

  • The inventory of townhomes is forecasted to increase 6.0%, a slight opening of the supply of relatively affordable options for buyers. 

  • Strong demand for townhomes, due to their relative affordability compared to single-family homes in recent years, is set to continue into 2025 with unit sales rising 2.9% and pricing going up 3.9% compared to 2024. 

  • Condominium prices will be up 3.5% from 2024 to 2025, a slight slowing of price increases recorded in recent years. 

  • As demand for condos begins to wane somewhat, inventory is set to increase 3.6% from 2024 to 2025. 

Arlington County (View Charts

  • Single-family inventory in Arlington is expected to increase 1.8% from 2024 to 2025. 

  • Total unit sales of single-family homes will decline 6.5% from 2024 to 2025, but in this small market that decline only represents a difference of 4 units per month. 

  • Despite the slight build-up in inventory and decline in sales, demand for Arlington single-family homes is set to push up prices 5.3% in 2025. Inside the Beltway will be competitive for buyers. 

  • Without many single-family units available, strong demand for Arlington townhomes will push up prices by 8.7% during 2025. 

  • While inventory is set to increase 4.3%, this represents an average increase of 1 unit being on the market at month’s end. 

  • Arlington condos recorded strong price increases in 2024, which creates market momentum, but affordability and the prospects for higher maintenance fees will soften price gains to 1.6% over 2025. 

  • As demand for Arlington condos softens slightly, unit sales will remain effectively flat and there will be a small uptick in inventory, averaging about 3.6% from 2024 to 2025. 

Alexandria City (View Charts

  • Median prices of Alexandria single-family homes are expected to jump 9.9% in 2025, being influenced by return-to-office. 

  • Already low unit sales are set to contract further, with a total of just 285 sales in 2025, down 4.7% from 2024. 

  • Alexandria’s townhome market will see prices increasing 3.9% in 2025. 

  • Recent price increases for potential sellers coupled with buyers acclimating to higher rates are expected to result in the average year-over-year inventory increases of 5.2% from 2024 to 2025, which really suggests that some units will be on the market for a few extra days, on average. 

  • Along with other core condo markets, Alexandria condo prices will rise 1.5% in 2025, with slightly higher inventories and a flattening of unit sales. 

Prince William County (View Charts

  • Prince William will remain a very attractive market for single-family homes with prices expected to rise by 3.5% for 2025, but still relatively affordable compared to core markets. 

  • The already tight inventory of for-sale single-family homes is forecasted to remain effectively unchanged and unit sales are forecasted to drop by 35 units (1%) for the year 2025. 

  • Townhomes in Prince William are forecasted to record a price increase of 4.0%, revealing the multi-year trend of families seeking this more affordable family-sized housing option is set to continue. The key market factor is being outside the core, but still a reasonable commute — reasonable by Northern Virginia standards. 

  • While year-over-year townhouse inventory is set to increase 5.0% on average, this comes after several years of inventory contraction. 

  • While Prince William’s condo market is not very large, prices are anticipated to increase 6.2%, revealing demand for relatively affordable homeownership opportunities. 

  • Both year-over-year unit sales and average year-over-year month-end inventory of condos are set to increase 6.0%, revealing that while the Prince William Condo market may not be large, it remains very active. 

Loudoun County (View Charts

  • Robust price increases in Loudoun County are set to continue into 2025, with single-family homes forecasted to cost 5.5% more in 2025. 

  • The strong demand for Loudoun County single-family homes will push up unit sales by 4.0% from 2024 to 2025 while decreasing month-end inventory by 1.0% on average from 2024 to 2025. 

  • The strong demand for Loudoun County also appears in the forecasted prices for townhomes, which will rise 3.8% in 2025 to a notable median price of $710,936. 

  • Townhouse inventory is forecasted to drop 3%, while unit sales will increase a mere 1%. 

  • As with single-family and townhomes, condominium prices are forecasted to increase a robust 8.1% over 2025. 

  • The strong overall demand to live in Loudoun County will keep condo inventories nearly flat and unit sales of condos increasing 2.0%, which means about 20 more sales in 2025. 

Stafford County (View Charts

  • Single-family homes in Stafford are set to increase 4.5% for the upcoming year, a modest deceleration from price gains seen in recent years. 

  • Activity in single-family sales is set to remain strong rising 2.2% to 1,495 units in 2025 supported by a 2.5% gain in average month-end inventories. 

  • Townhome price increases will remain strong, increasing 3.5% in 2025 as market activity increases (1.9% more units) on rising inventory (+3.7%). 

  • Finally, while condo prices in the County are set to increase 3.9%, the County’s condo market is nascent, with just 89 unit sales forecasted for 2025. 

Throughout the year, NVAR releases monthly market statistics, delivering local market data for the cities and counties in the NVAR region. Please visit nvar.com/MarketStats for more information.  

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