Northern Virginia real estate continues as a ‘bright spot’ in the current economic worries. However, there’s one aspect that may hold the housing market back from achieving its full potential this fall and winter: the lack of homes for sale.

Buyers in Northern VA are actively purchasing homes, looking to capitalize on today’s historically low interest rates, but there just aren’t enough houses for sale to meet that growing demand. Sam Khater, Chief Economist at Freddie Mac, explains:

“Mortgage rates have hit another record low due to a late summer slowdown in the economic recovery…These low rates have ignited robust purchase demand activity…However, heading into the fall it will be difficult to sustain the growth momentum in purchases because the lack of supply is already exhibiting a constraint on sales activity.”

National Association of Realtors reports right now, unsold inventory sits at a 3.1-month supply at the current sales pace. The Northern VA market is 2.2 Month supply. To have a balanced market where there are enough homes for sale to meet buyer demand, the market needs inventory for 6 months. The market is nowhere near that number. If the trend continues, it will get even harder to find homes to purchase this fall an winter, and that may slow down potential buyers. Danielle Hale, Chief Economist at realtor.com, notes:

“The overall lack of sustained new listings growth could put a dent in fall home sales despite high interest from home shoppers, because new listings are key to home sales.”

The realtor.com Weekly Recovery Report keeps an eye on the number of listings coming into the market (houses available for sale) and the total number of listings staying in the market compared to the previous year (See graph below):Buyers are clearly scooping up homes faster than they’re being put up for sale. The number of total listings (the orange line) continues to decline even as new listings (the blue line) are coming to the market. Why? Javier Vivas, Director of Economic Research at realtor.com, notes:

“The post-pandemic period has brought a record number of homebuyers back into the market, but it’s also failed to bring a consistent number of sellers back. Homes are selling faster, and sales are still on an upward trend, but rapidly disappearing inventory also means more home shoppers are being priced out. If we don’t see material improvement to supply in the next few weeks, we could see the number of transactions begin to dwindle again even as the lineup of buyers continues to grow.”

Is it a good time to sell in Northern VA?

Yes. If you’re thinking about selling your house in Northern VA, this fall and winter is a great time to make it happen. There are plenty of buyers looking for homes to purchase because they want to take advantage of low interest rates. If you are looking to step up into the luxury real estate market, or an empty nester looking to downsize, it is an excellent time.

Bottom Line

If you’re considering selling your house, this is the perfect time to connect so we can talk about how you can benefit from the market trends in Northern VA.