Housing market sees gains in February, but Iran war could disrupt momentum

Housing markets in Northern Virginia and Hampton Roads posted modest year-over-year gains in February, but the outlook for the spring selling season has grown more uncertain as mortgage rates began climbing again last week amid global instability tied to the war in Iran.

Northern Virginia

The Northern Virginia Association of Realtors reports that 974 homes were sold in February, a 3.9% increase from February 2025. The total sales volume was $834.85 million, a 9.7% year-over-year increase, which the association said reflected “continued demand.” New pending sales in February rose to 1,195 units, up 8.8% compared to February 2025.

“The Northern Virginia housing market remains fundamentally strong,” NVAR CEO Ryan McLaughlin said in a statement last week. “Sales activity increased, and buyers continue to show confidence in the long-term value of owning a home in this region. Meanwhile, the increase in listings means some buyers will have more opportunities without facing quite the same level of competition we saw over the past several years.”

NVAR said February’s market showed signs of gradual normalization as buyers gained more choices. Active listings rose to 1,699 units, an 11.8% increase from February 2025. Months of supply of inventory (MSI) in February — a measure of how many months homes would remain on the market if no new inventory were added was 1.23, up 10% compared to February 2025.

The median sold price in February was $720,500, a 1.7% decrease compared to February 2025. And NVAR reported that homes spend more time on the market, with the average days on market rising to 30 days, a 36.4% increase from last year.

NVAR said this shows that homes are taking longer to sell and that buyers have more time to weigh their options.

“For several years, Northern Virginia experienced extraordinarily tight inventory that pushed buyers into fast-paced decision making,” McLaughlin said. “What we are seeing now is a market that is becoming more deliberate. Homes are still selling, and sales volume continues to grow, but buyers are gaining the time and flexibility to make thoughtful decisions. That is a positive development for long-term market stability.”

NVAR reports home sales activity for Fairfax and Arlington counties, the cities of Alexandria, Fairfax and Falls Church, and the towns of Vienna, Herndon and Clifton.

Hampton Roads

Hampton Roads saw an increase in housing sales in February both month-over-month and year-over-year, according to data released March 10 by the Real Estate Information Network (REIN).

There were 1,600 closed sales in February, up from 1,576 in January and up 3.16% from the 1,551 in February 2025. In February, the MSI was 2.14, down from 2.16 in January, but up from 2.12 in February 2025.

Active residential listings for February totaled 4,499, down from 4,528 in January, but up 3.66% year-over-year from February 2025’s 4,340.

“It’s a good sign to see the real estate market up over last year,” said John Chandler of Berkshire Hathaway HomeServices RW Towne Property Management and president of REIN’s board in a statement. “While agents are certainly working hard to serve their clients, lower mortgage rates make purchasing a home much more attractive for prospective buyers.”

The median sales price of of homes sold during February was $355,000, about on par with the $355,170 in January and slightly up from the $346,000 in February 2025.

February’s pending sales for the month stood at 1,988, up from 1,919 in January and up 12.06% from 1,774 in February 2025.

Homes spent a median of 30 days on market in February, down from 41 days in January and up from 28 in February of last year.
Founded in 1969, REIN is a regional multiple listing service that covers an area stretching from Williamsburg east to Virginia Beach and south across the North Carolina border.

Central Virginia

The Central Virginia Regional Multiple Listing Service divides its data between single-family homes and condos and townhomes.

In the region, there were 1,021 closed single-family home sales in February up 8.5% from the 941 sold at the same point in 2025. For condos/townhomes, there were 202 sales, up 6.3% from February 2025’s 190.

Pending sales for single-family homes increased 9.4% year-over-year from 1,148 in February 2025 to 1,256 in February of this year. For condos/townhomes, there were 252 pending sales last month — a 1.2% increase from February 2025’s 249.

Single-family homes spent 43 days on the market in February —up from the 39 days on the market the previous year. Meanwhile, condos/townhomes spent 53 days on the market, up from the 41 reported in February 2025

The median sales price for single-family homes was $395,000 in February of this year compared to $387,300 in February 2025. The median sales price for condos/townhomes increased 4.7% from $360,000 in February 2025 to $377,050 this year.

Single-family homes for sale in February totaled 2,096, a 11.9% year-over-year decline from 2,378 homes, while the number of condo/townhome units for sale totaled 652, a 8.1% rise from February 2025’s 603 units.

The CVR MLS includes data for the cities of Richmond, Petersburg, Hopewell and Colonial Heights and the counties of Amelia, Charles City, Chesterfield, Dinwiddie, Goochland, Hanover, Henrico, King & Queen, King William, New Kent, Powhatan and Prince George.

Troubles on the horizon

While February showed positive signs for Virginia’s housing market, experts caution that the war in Iran could disrupt that momentum and create new uncertainty for the industry.

Virginia Realtors Deputy Chief Economist Sejal Naik noted that at the end of February, mortgage rates in the country fell below 6% for the first time since 2022. Along with rising inventory levels, continued buyer interest and softening price growth in Virginia, she said the continued downward trend in mortgage rates was signaling towards a busier spring market this year.

“That momentum has since been tempered by the outbreak of the Iran war, which has sent global energy prices surging and unsettled bond markets,” Naik said in a statement. “The effect on housing has been swift, with the national average 30-year fixed mortgage rate climbing to 6.11% as of March 12.”

She noted that the rates remain more than half a percentage point below where they stood a year ago, when the 30-year-fixed mortgage rate was 6.65% in the United States. Still, Naik said the sentiment of housing market participants has shifted, with both buyers and sellers exercising caution and adopting a “wait-and-see” approach.

“Furthermore, supply chain disruptions are likely to drive up the cost of construction materials, which could lead to delays and higher prices in the new construction space,” Naik said. “This is particularly troubling as the market has already been struggling with tight supply and affordability constraints. How significantly the conflict ultimately reshapes the spring market will depend largely on its duration. A swift resolution could allow rates to ease and activity to rebound quickly. A prolonged conflict, however, risks keeping buyers and sellers on the sidelines well into the season, worsening an already challenging environment.”