It’s already happened in a number of other local jurisdictions. But will it happen in Fairfax County, and if so, when?
For months, the average sales price of single-family homes in Northern Virginia’s largest jurisdiction has moved closer to the $1 million mark – coming tantalizingly close over the summer before falling back slightly in a nod to the market’s seasonality.
In September, the 743 single-family properties that went to closing averaged $943,008, up from $915,992 a year before, according to figures by MarketStats by ShowingTime, based on listing data from Bright MLS.
If Fairfax crosses the $1 million threshold, it will mark a watershed of sorts, with the seven-figure average sales price moving from the innermost suburbs out a little farther.
But will it happen? And if so, when?
Eli Tucker of Eli Residential Group sees it occurring within the next 12 to 18 months, barring an economic downturn.
Dee Murphy of Compass said she expects it, but not as quickly. Perhaps in the next three to five years.
Both, however, said moving into a higher level of the real-estate stratosphere, from the high six figures to the low seven figures, is a normal progression that is cause for neither celebration nor trepidation.
“I don’t think it’s a ‘good’ or ‘bad’ thing – it is the market,” Murphy told the Sun Gazette. “I’ve watched home prices rise beyond what I thought was possible for years. Our local economy has always been able to support this, so I would expect that trend to continue.”
“I don’t think there’s much to it other than it being a notable data point, and it’ll have no real impact on the market,” Tucker said. “People are already being priced out and feeling the pressure of trying to buy a detached home, so this will just be a continuing of the challenges, versus introducing a new challenge.”
After being knocked around during the first blush of the COVID pandemic, the Northern Virginia real-estate market rebounded starting in mid-2020 and has remained strong ever since. In recent months, the market seems to have reverted to its pre-COVID seasonality, with a hotter market in spring and summer, then cooling into the autumn.
“In September, the average price pulled back [after peaking at $980,176 in June], as would be expected in the fall,” said Lizzy Conroy of the Huckaby Briscoe Conroy Realty Group of Keller Williams Real Estate.
What might the future bring?
“Price will continue to rise, although likely at a slower pace than we have seen this year,” Conroy said. “Hitting the $1 million mark would be a good sign that demand remains strong.”
Demand is one thing, but will prospective buyers simply be priced out of the market as costs escalate? Casey Samson of Samson Properties thinks it’s possible.
“We are currently in a ‘hyper-peak’ [market],” Samson told the Sun Gazette, with prospective purchasers spurred by low mortgage-interest rates (“that can change quickly”) and lack of inventory (“that can change quickly” as well, Samson said).
“We are seeing signs that the steam is leaving some of the markets,” he said. “Buyers are starting to push back. Buyers are no longer tethered to the office, so they can move farther out, where properties are less expensive” and homeowners can get more space for their buck.
On the other hand, Samson pointed to buyers from more pricey areas who move into the local area and have no qualms with bidding up sales prices. “One buyer from Los Angeles bid $1.65 million on a home, which was $250,000 over list and $150,000 over the next highest bidder,” Samson said. “His comment was that he could get a rambler for that price in L.A.”
Conroy said some home-searchers have expanded their efforts into Loudoun and Prince William counties, but are not always able to find the pot of gold.
“The challenge is that the rate of new home-building in these neighboring counties has not kept up with the pace of demand, and they too face low inventory,” she said.
If it does reach the $1 million mark for single-family homes, Fairfax County would become the fourth Northern Virginia jurisdiction to do so, joining Arlington, Falls Church and Alexandria.
That last community spent several months over the $1 million mark, but in September the average sales price for a single-family home was $915,259. September averages were $1,174,898 in Arlington and $1,194,879 in Falls Church.
Scott McCaffrey contributed to this report.