Northern Virginia has no shortage of people who want to buy homes. What we continue to struggle with is having enough homes available for them to buy.
That imbalance has defined our housing market for years. Northern Virginia remains one of the most competitive and expensive housing markets in the country and finding ways to increase the number of homes available to buyers is critical.
According to Northern Virginia Association of Realtors® market data, 16,610 homes were sold across the NVAR region in 2025, up modestly from 16,357 in 2024 and 15,958 in 2023. At the same time, the median sales price reached $750,000 in 2025, up from $729,710 the previous year.
Those numbers illustrate something Realtors® see every day: demand for Northern Virginia housing remains strong, but our market needs more inventory and greater mobility.
There are many pieces involved with solving that problem. We need to build more housing, encourage policies that allow our housing stock to grow with our population, and continue addressing the affordability challenges facing buyers.
But there is another potential solution currently before Congress that deserves attention.
A Tax Provision That Hasn’t Changed Since 1997
Under current federal law, homeowners selling their primary residence can generally exclude up to $250,000 in capital gains from federal taxation, or $500,000 for a married couple filing jointly.
Those limits were established in 1997.
Nearly three decades later, they remain unchanged despite dramatic increases in home values across the country, and particularly in Northern Virginia.
Think about what that means for someone who purchased a Northern Virginia home 20, 25, or 30 years ago.
A home purchased for $250,000 or $300,000 decades ago has appreciated significantly in value. When that homeowner begins thinking about downsizing, relocating, or simply moving to a home that better meets their needs, the potential tax consequences of selling dissuade them from moving. When that happens, another home stays off the market.
One Seller’s Decision Affects the Next Buyer
This is where an individual tax decision becomes a broader housing supply issue.
Housing markets depend on movement.
A longtime homeowner sells and downsizes. A growing family buys that home. Their previous home becomes available to another buyer. A first-time buyer enters the market.
One transaction can help create another.
When long-time homeowners remain in homes they might otherwise sell, that movement slows down. There is one less listing available for the family looking for more space and one less opportunity for everyone farther down the housing ladder.
For Realtors®, this isn’t theoretical. You work every day with buyers struggling to find the right home and with longtime homeowners trying to determine whether now is the right time to sell.
Congress has an opportunity to remove one obstacle from that equation.
The More Homes on the Market Act
The bipartisan More Homes on the Market Act would double the existing home-sale capital gains exclusion from $250,000 to $500,000 for individuals and from $500,000 to $1 million for married couples.
This is not about eliminating capital gains taxes on home sales. Gains above the new thresholds would remain taxable.
It is about modernizing thresholds that Congress established nearly 30 years ago and that have not been adjusted to reflect what has happened to American home values since.
The proposal would be particularly meaningful in high-cost housing markets like Northern Virginia, where decades of appreciation mean that more long-time homeowners find themselves approaching or exceeding the existing limits.
And importantly, this is not simply about helping the person selling the house.
It’s about the person waiting to buy it.
More Inventory Means More Opportunity
Northern Virginia’s housing challenges will not be solved by any single piece of legislation.
But increasing housing supply requires looking at every reasonable option available to us. We should build more homes. We should encourage policies that make housing development more achievable. And we should also examine outdated federal policies that may discourage existing homes from coming onto the market. The More Homes on the Market Act addresses one of those barriers.
The push for federal change is complemented here in Northern Virginia by NVAR’s NOVA Housing Supply Framework, a regional effort focused on practical, actionable policies to expand housing options and increase supply. The Framework, developed in partnership with the Northern Virginia Chamber and the Northern Virginia Building Industry Association — and supported by regional coalition members the Alexandria Chamber of Commerce, Loudoun Chamber, and Northern Virginia Affordable Housing Alliance — focuses on three key priorities:
- Diversifying the types of homes being built
- Improving speed to market by reducing zoning and development delays
- Fostering a “culture of yes” that encourages creative approaches to building more housing.
Together, these efforts can help create more diverse and attainable housing across the region.
If modernizing a nearly 30-year-old provision of the federal tax code encourages more homeowners to sell when they’re ready, that means more listings. More listings mean more choices for buyers. And greater movement throughout the housing market creates opportunities for families at every stage of homeownership.
That’s why the More Homes on the Market Act deserves serious consideration from Congress.
For Northern Virginia, where housing supply, affordability, and economic competitiveness are so closely connected, helping unlock homes that already exist should be part of the solution.
