Real Estate Market Update

 Real Estate Market Update: July 2026

Summer may be winding down, but the housing market is still keeping everyone on their toes.

Mortgage rates are on the rise again, causing some buyers to hit pause on their search for a new home. At the same time, inventory remains much higher than it was just a few years ago. This gives buyers more choices and, in many parts of the country, more negotiating power than we've seen in quite some time.

Here in the DMV, it's a different story. 

The local market continues to show resilience, with home sales, prices, and inventory all increasing compared to last year. 

Here's what you need to know from the July 2026 housing market.

July Housing Market Trends

Home sales dropped as mortgage rates increased to their highest level in over a year.

Existing Homes

While home sales decreased by 2.4% month-over-month, they increased by 2.8% compared to last year, according to the National Association of Realtors (NAR). The median existing-home sales price was $440,600, a 1.8% increase and an all-time high.

NAR chief economist Lawrence Yun pointed out that the up-and-down home sales activity can largely be attributed to fluctuations in mortgage rates, which shows just how sensitive homebuyers are to affordability conditions. 

Even so, affordability has improved since last year, as more than half a million jobs have been added since the beginning of this year.

New Construction Homes

Affordability challenges also continue to impact the new construction market.

Sales of newly built single-family homes rose by 1.6% in June, but the pace of new home sales is down 5.6% from the previous year, thanks to higher mortgage rates, the National Association of Home Builders (NAHB) reported. About 62% of builders are still offering incentives to boost sales.

The median new home sale price dropped by 3.3% in June to $398,300, and is down 2.7% from a year ago.

Housing Inventory

There was a 0.6% decrease in unsold inventory in the existing home market, NAR reported. There’s currently a 4.6-month supply. 

New construction inventory was also down 0.2% in June, and down 3.2% from last year. This represents a 9.3-month supply at the current building pace, according to NAHB. 

Combined new and existing inventory is around 5.2 months, which NAHB pointed out is the highest level since the fall of 2014.

Mortgage Rates

As of the end of July 2026, the 30-year fixed-rate mortgage averaged 6.66%, according to Freddie Mac’s Primary Mortgage Market Survey. Mortgage rates have been rising steadily since the beginning of the month.

Mortgage News Daily reports an even higher average rate of 6.83%, adding that higher rates are driven by weakness in the bond market.

DMV Housing Market Update

The D.C.-area housing market has been fairly stable this year. According to the Northern Virginia Association of Realtors (NVAR), Northern Virginia saw growth in home sales, prices, and inventory in June.

Home sales increased by 3.9% and total sales volume also saw a huge 12.7% boost year-over-year. The median sold price reached $810,000, a 5.2% increase compared to June 2025. Properties also sold slightly faster than last year, with homes spending an average of 19 days on the market.

“June’s numbers tell the story of a market that is finding greater balance without losing its competitive edge,” said NVAR CEO Ryan McLaughlin.

The number of active listings went up by 12.1% compared to last year. Months of supply increased to 1.98 months, a 7.8% increase over the past year.

In the D.C. metro area, the strong spring market led to a slower summer. 

The housing market saw increased buyer activity during the first half of the year, according to Bright MLS, but this could change. There’s still plenty of demand, but the multiple listing service expects a slight cooling in the second half of the year as affordability remains a constraint.

Number of Condos for Sale Hit 10-Year High

If you’ve struggled to find a detached single-family home, don’t pass on a condo or townhome! 

According to HousingWire Data, there were 233,030 condos and townhomes for sale in June – more than any June in the past decade, and more than double what was available in 2022. More options generally means less competition and more room to negotiate. For first-time buyers who don’t need too much space, this can be a great way to break into the housing market.

Condo prices are also typically lower. The median condo price was $380,000 in June, NAR reported. This is more than $66,000 lower than a detached single-family home.

Patience Pays Off for Buyers

Higher mortgage rates have slowed buyer demand across much of the country, but that doesn't necessarily mean it's a bad time to buy.

According to Redfin, there are now hundreds of thousands more sellers than buyers nationwide, giving buyers more time to compare homes, negotiate prices, and ask for seller concessions. While mortgage rates have climbed to their highest level in over a year, median asking prices have eased, and monthly housing payments have come down to a median of $2,575 from recent highs.

Of course, every market is different. If you're shopping in today's market, patience and preparation could put you in a much stronger negotiating position than buyers had just a few years ago.

Final Thoughts

Affordability is still the biggest concern for most homebuyers as mortgage rates reach their highest level in over a year. However, we’re seeing more balance than we’ve experienced in recent years. 

The labor market has improved, and housing payments have dropped as sellers’ median asking prices plummet to their second-lowest level since the start of the year, according to Redfin. There are also hundreds of thousands more sellers than buyers right now, meaning buyers have negotiating power in most of the country.

Looking to buy or sell in the DC area? Don’t navigate the complexities of the current housing market alone! Reach out today for expert real estate leadership.