The new year is expected to bring ongoing, but slower, increases in home prices across Fairfax County.
“The prices are going to continue to rise, but slightly, not nearly the rate of increase we’ve seen in other years,” said Terry Clower of the Center for Regional Analysis at George Mason University. “It’s not going to be as dramatic.”
The center partnered with the Northern Virginia Association of Realtors (NVAR) for a 2026 real estate forecast released on Dec. 29.
The crystal ball used by the prognosticators was clouded by continued uncertainty around the region’s economy and potential impacts of the federal government workforce continuing to contract. That uncertainty had another organization, the multiple listing service Bright MLS, predicting a decline in sales prices for the D.C. area in 2026.
“There are a lot of things going on in the regional economy — this means we’re at a bit of a pivot point, which is always challenging for forecasters,” Clower said.
The consensus opinion is “we’re moving into a market that’s more balanced” between buyers and sellers, NVAR CEO Ryan McLaughlin said in a 45-minute video with industry leaders accompanying the report.
It follows the Covid era, when a tight inventory of homes for sale pushed prices higher across both Northern Virginia and the D.C. region.
The coming year should provide “arguably a healthier dynamic in the marketplace,” McLaughlin said.
Casey Menish, NVAR’s 2025 president and an affiliate of Pearson Smith Realty, agreed that, with a more balanced market, “you can really take the time to buy the right house, and not just jump on the first one.”
Expectations for the 2026 Fairfax County market include:
- Single-family homes: The median sales price is expected to rise 1.9% year-over-year, with sales up 8.4%
- Townhouses: Median prices are expected to rise 1.7%, with sales up 4.2%
- Condominiums: Prices are expected to decline 2.7%, with sales up 2.4%
Condominium appreciation in Fairfax County and regionally is being held back in part by higher fees charged by condo associations, Clower said. Those increased costs reflect general inflation over the past three years, but aren’t expected to cause a condo catastrophe.
“This is in no way what you’d think of as a bad downturn,” Clower said. “It’s not like any real price collapse.”
While the 8.4% bump up in projected single-family home sales appears significant, it comes with a caveat.
“That sounds like a big jump, but these are coming off of pretty low numbers [in 2025] for a county as big as Fairfax,” Clower said.
Helping prospective purchasers will be an anticipated double-digit bump up in inventory compared to Covid years.
The region already has seen “a notable increase in inventory, which started last year, in late 2024, and is going to accelerate,” Clower said.
Despite economic concerns and questions around federal government employment, 2026 may be a year where growth in personal income begins to catch up with increases in housing costs.
That would provide “a chance for our area to catch up a little bit” after years of housing costs outpacing income growth, said 2026 NVAR president Rob Carney, who is affiliated with TTR Sotheby’s International Realty.
In the single-family sector, Fairfax’s projected 1.9% rate of price appreciation is in the middle of the pack among jurisdictions.
Forecasters expect Alexandria to lead the group with a 4.2% increase in median price, followed by Arlington (+3.8%) and Loudoun County (+3.3%). Declines are expected in Prince William (-0.2%) and Stafford (-4.6%) counties.
Post-Covid return-to-work edicts may be negatively impacting markets outside the immediate D.C. metro area and strengthening more close-in locations.
“There are folks that might have been thinking about farther-out suburbs that have decided, nope, we’re going to keep our focus inside the Beltway,” Clower said. “That’s going to help keep those price rises going up.”
Interest rates are expected to hover in the 6% range for the coming year. That’s slightly lower than the long-term average but significantly higher than what buyers became used to during the early part of the pandemic.
“We’re never going to get back to the rates we had a few years ago, but there has been improvement there to help with affordability,” Carney said.
NVAR is a trade association with approximately 13,000 members across the region, dealing with both residential and commercial real estate. Year-end Northern Virginia and D.C. region sales and price figures for 2025 are expected to be released Jan. 11.
Nationally, home sales are expected to rise about 14% in 2026 and home prices to increase about 4%, according to a National Association of Realtors forecast published in November.
Lawrence Yun, the organization’s chief economist, said the expected rebound reflects easing mortgage rates, continued job gains and improving market stability after several challenging years.
“Next year is really the year that we will see a measurable increase in sales,” Yun said. “Home prices nationwide are in no danger of declining.”
