September Highlights:

• BUYER SHOWINGS CONTINUE DECLINE; BIG SEPTEMBER DROP  
  
  
• Fairfax County Average Price DOWN 4% From May High 
  Home prices peaked as usual in May/June (contracts written in April/May) across all Northern Virginia sub-markets. The typical seasonal price decline is now underway in Northern Virginia, pressured by rising inventory and a shrinking buyer pool. Buyer showings (demand) worsened DOWN 17% in September. Through September, the market has returned 52% of the price gains logged from Jan-May. This compares to 53% in 2025. The three important top-line market metrics remain consistent through September. Here is September 2026 compared to September 2025 - Active Listings (SPIKE UP 32%), Days on Market (UP 7%), and Sold-to-List Price Ratio (DOWN 10bp).
  
  
• Buyer Showings DOWN 1% in 2026
  Buyer showings (demand) in September were DOWN 17% compared to last year, likely due to rising interest rates. This was a significant and unusually large decline and a continued deterioration over the last four months, tracking DOWN 4%, 5%, 7%, and 17% in Jun-Sep. This has eroded showings that were once UP 5% YTD in April to now DOWN 1%. Importantly, this results in a swing of 54,000 showings for the DC Metro area. At a typical rate of 14 showings per home sale, the shrinking buyer pool may have contributed to 4,000 fewer home sales YTD.
  
  
• Listings UP 21% from August to September
  This is a reversal from last month's DOWN 14% and significantly outpaced the typical average UP 4% during the last 6 years.
  
  
• September Listings UP 3% vs. 5-year Average
  Seller listings stabilized in 2024, resisting the continued downtrend experienced in recent years. September's UP 3% is the first monthly positive number in several years. Listings have substantially improved in Northern Virginia from down 20 to 40% in recent years. This improvement is primarily because the higher listing years before the pandemic continue to fall out of the 5-year calculation. This increasing supply helped to increase total homes sold in Jan-Sep 2026 (22,270) compared to Jan-Sep 2025 (21,784) - UP 2%.
  
  
• "Rate Locked Sellers" are UNLOCKING Increasing Inventory
  In the wake of rising interest rates beginning in 2022, sellers largely "stayed in place" in 2023 and 2024. However, in 2025, sellers brought an increasing number of New Listings to the market (UP 8%). Seller behavior continues to trend this year UP 5% through September. The typical home seller is now 63 years old, a record high. This compares to age 54 in 2014 and age 45 in 2007.
  
  
• Contract Ratio FALLS to 0.38 (stronger shift toward buyers)
  Listings Under Contract represent just 28% of the total September listings compared to those available and Active for sale at 72%. This is the lowest monthly contract ratio in over 10 years and sits 36% slower than the 37/63 seen in September 2025. Seller Price Reductions are holding at near relative highs, now representing 45% of the current 5,250 Active listings in mid-October. The importance of sellers having the expert guidance to correctly price, position, and market a home in today's environment cannot be overstated. 
  
  
• Inventory SPIKES UP 30% vs. September 2025
  Inventory in Northern Virginia has been relatively steady in 2026 after 2025's fast-paced uptrend over 2024. August inventory of 2.11 months matched July's 2.10 months. September inventory SPIKED UP 30% to 2.47 months compared to 1.90 months in Sep-2025. September has not seen inventory this high since 2017 when it was 2.50 months. The higher inventory in 2025-26 is primarily a result of a marked increase in the number of Active Listings lingering on the market. Northern Virginia saw about 3,000 Active Listings in much of the 2020-24 period, rising to 5,000 Active Listings in 2025-26 with a recent surge to nearly 6,000 Active Listings in September. This presents a significantly different market compared to 2020-24 when September inventory ranged from just 1.05 to 1.40 mos.
  
  
• Sold-to-List Price Ratio DOWN 10bp Exhibits Tight Prices
  Buyer contract prices averaged 98.1% of Seller Asking in September - down slightly from 98.6% in August. This is down only 10 basis points from the 98.2% experienced in September 2025, illustrating how prices have thus far been holding, despite higher inventory and lower contract ratios. The contract cancellation rate generally ranges between 12 and 18%. The current cancellation rates in mid-October are trending between 20 to 25%, even hitting 30% at times. Much higher than normal for this time of year.
  
  
• Speed to Contract is STEADY from 2025
  Speed to contract is consistent with last year and seasonal trends. In September, 39% of the 2,103 homes sold transacted in the fastest range (0 to 10 days), down from 42% in August, but nearly the same as 40% in September 2025. By contrast, 38% of sales exceeded 30+ days on market - nearly the same as the 36% in September 2025. The average days on market in September was 29 - up slightly from 27 days in September 2025.

• Fed September Meeting: RATE INCREASE to 3.75%
  In line with market expectations, the Fed increased its benchmark rate 0.25% on September 16. The Fed voted for the hike due to persistent inflation above 2% and to cool down an economy that has gathered faster speed than desired. The next meeting is scheduled for October 28. The current futures market places a 76% chance of no rate change this month.
  
  
• Headline Inflation RISES to 3.7%, RISES to 0.6% Aug to Sep
  Reported this morning, September inflation increased to 3.7%, up from July/August's 3.4% year-to-year. Month-to-month inflation rose to 0.6%, up from 0.4%. Both numbers were in-line with expectations. "Core Inflation" increased to 2.6%, up from 2.4% in August. Core inflation excludes more volatile energy and food prices.
  
  
• Conventional Mortgage Rate RISES Above 7%
  With the increase in inflation during the last several months and other concerns in the bond market, mortgage rates have been pressured upward to the highest levels since October 2023. Conforming rates are hovering around 7.25% and VA/FHA rates around 6.875%.