What to expect from D.C.'s housing market next year
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Don't expect Washington's 2026's housing market to look all that different from this year's sluggish market, a new report from Bright MLS says.
The big picture: More than ever, it's local economic outlooks, not the national one, that are driving regional housing markets across the country, says Lisa Sturtevant, the chief economist for Bright MLS, the multiple listing service.
- Think the AI boom in San Francisco, or tourism-heavy places hit by reduced consumer spending.
And so as the national real estate market is expected to inch its way closer to balanced next year, D.C. will lag in comparison, Sturtevant tells Axios.
- "Local reasons are key," she says. "And our reason happens to be uncertainty with the federal government."
State of play: We'll see more of a buyer's market in Washington in 2026.
- Expect weaker-than-usual demand and slower price growth and sales, according to Bright's 2026 housing forecast.
- The DMV is the only mid-Atlantic region where 2026 prices are anticipated to fall.
By the numbers: The number of active regional listings will likely increase 14% between this year and next as houses continue to sit on the market.
- This — combined with sellers lowering asking prices — could cause the median metro area sales price to drop: from $623,140 in 2025 to $616,700 in 2026.
Bright actually forecasts a 7.8% jump in the number of regional home sales between this year and next as sidelined buyers take advantage of lower rates and higher inventory.
- Yes, but: That's a slower uptick than the predicted national average of 9%.
- The DMV will still be at only about 80% of pre-pandemic home sales levels, says Sturtevant.
Zoom in: Weaker hyper-local markets will continue to be concentrated in the District and in exurban areas affected by return-to-work, like Calvert and Spotsylvania counties, says Sturtevant.
- Burbs like Montgomery and Fairfax counties will be stronger.
- Sturtevant expects the condo market to remain weak, with lots of inventory, while the luxury market will stay robust.
The intrigue: Mortgage rates will fall to 6.15% by the end of next year, Bright predicts.
What we're watching: There was an uptick in the number of area sellers pulling their listings off the market this fall because of low offers, says Sturtevant.
- It's possible these people will re-list their homes in the spring at lower price points, she says, creating a surge in inventory that, combined with lower rates, could make the spring market busier than anticipated.
Reality check: This DMV forecast could be upended by sudden moves from the Trump administration, Sturtevant says.
- A major agency could abruptly leave D.C., the government could shut down again, or National Guard troops could be deployed to other parts of the region, for instance.
The bottom line: "I joke a lot that forecasting in the best of times is really hard," says Sturtevant. "In this period, it's even harder."