2026 DC Metro Real Estate Market Forecast: What Buyers and Sellers Should Expect

The past couple of years have been steady—but undeniably slower—across the real estate market nationwide. In fact, 2024 and 2025 saw some of the lowest home sales in decades, and the DC metro area felt that slowdown as well.

Looking ahead, 2026 is shaping up very differently.

I’m Jennifer Young with Jennifer Young Homes, and based on national data, local trends, and what we’re seeing firsthand across DC, Maryland, and Virginia, there are strong indicators that home sales activity is set to increase in 2026. Here’s what buyers, sellers, and investors should know as the year unfolds.

A Shift Toward Increased Home Sales in 2026

One of the biggest changes we’re anticipating this year is an increase in home sale activity across the DC metro real estate market. As affordability improves and confidence grows, more buyers are expected to re-enter the market.

At the same time, many sellers who have been waiting on the sidelines may finally feel motivated to move—especially if mortgage rates trend downward. When inventory rises, activity naturally follows, and that’s exactly the environment we expect to see take shape in 2026.

Mortgage Rates, Affordability, and Buyer Demand

Much of the optimism around the 2026 housing outlook comes down to affordability.

There has been significant discussion around the federal government potentially purchasing $200 billion in mortgage-backed securities. If this happens, it would likely place downward pressure on interest rates, improving affordability for buyers across the region.

Should rates move into the mid-to-low 5% range, especially with strategic rate buydowns, we expect a noticeable surge in buyer demand. Many well-qualified buyers who have been waiting for the right moment would suddenly be able to afford homes that were previously out of reach.

Will Lower Rates Impact Home Prices?

This is where things get especially interesting.

If mortgage rates drop aggressively—as we saw several years ago—we could also see renewed home price appreciation in many parts of the DC metro area. It becomes a balancing act between supply and demand.

Some rural markets are currently experiencing a degree of oversupply, while suburban and urban areas remain relatively balanced. If affordability improves quickly, increased buyer competition could push prices upward in certain neighborhoods, even while other areas experience stabilization or slight softening.

Inventory Trends Across DC, Maryland, and Northern Virginia

Inventory levels will play a critical role in how 2026 unfolds.

We expect:

• More choices for buyers as inventory improves

• Stronger terms for sellers in many markets if demand accelerates

• A generally healthier, more active market overall

Balanced supply in close-in and suburban areas should help maintain stability, while rural markets may continue to adjust.

What the Experts Are Saying About 2026

Recent data from the National Association of REALTORS® economists predicts a 14% increase in home sales nationwide. Even a more modest 5–10% increase would represent a meaningful shift after the slower pace of the last two years.

Locally, economists from the Northern Virginia Association of Realtors are forecasting:

• Flat or minimal appreciation in some suburban counties (including Fairfax, Prince William, and Montgomery)

• Some appreciation closer to DC

• Possible depreciation in more rural areas

While forecasts vary, many of our sellers are not seeing significant price declines, and we continue to monitor these trends closely.

Why Local Expertise Matters More Than Ever

One important reminder for buyers and sellers alike: don’t rely solely on the mortgage rates you see online.

Our trusted local lenders are often able to secure better terms and creative financing options that dramatically improve affordability. Having the right team—and accurate information—can make all the difference in your real estate strategy this year.

Thinking About Buying or Selling in 2026?

If you’re considering buying, selling, investing, or simply want a better understanding of where the DC metro housing market is headed, we’re always happy to help.

There’s never any pressure or obligation—our goal is simply to give you the information you need to make the best decision for your situation.

Here’s to a busy, steady, and strong real estate market in 2026. Thank you for your continued support—we wish you a wonderful year ahead.