Do Days on Market Matter?

It Depends on Your Expectations

  

Days on Market or DOM is a real estate statistic that can be very misleading for both homeowners and home buyers. On the surface, this is just the number of days a particular property has been listed on the multiple listing service (MLS) without being sold.

Sounds simple, right?


Perhaps not. For instance, 60 days on market could sound like a long time in a particular zip code, price range or dwelling type (single family home, condo, etc.). The same 60 days could mean something completely different in a different zip and price range.


For instance, the general statistic for August in zip code 85254 in Scottsdale was 77 single family homes sold and the average Days on Market was 70.


Now, check out what happens when we look at Days on Market when we include price ranges in the 85254 zip code in Scottsdale:

  

$300-400k - 16 sales and 62 DOM

$400-500k - 31 sales and 45 DOM

$500-600 - 13 sales and 59 DOM

$600-700 - 5 sales 80 DOM

$700-800 - 5 sales 122 DOM

$800-900 - 2 sales 233 DOM


Are you seeing a pattern here? Yes! Price influences how long it takes a home to sell even in the same zip code.


There are many factors other than price that influence Days On Market.  Here are just a few:


  • Zip Code – Location Location Location. Great neighborhood versus "up and coming" affects the number of Days On Market.


  • Condition of the home or homes nearby – We have all seen the “ugly house next door” problem and unfortunately, it DOES impact Days on Market.


  • Listing Status. A listing is in  Active status when it is entered into the MLS. This is when the Days On Market counter starts. When a contract is accepted by the seller, the agent can place the house on Pending status which stops the DOM counter and Buyers Agents can no longer show it.

    The seller can, however, choose to keep marketing the house for backup offers in case the accepted offer “falls out”, which can happen. To keep marketing the listing, the agent can place the house in UCB (under contract but accepting backup offers) or CBS( contingent on the buyer selling their own home) status which keeps the DOM meter running.


  • Listing price is too high. Most sellers think their home is worth more than all the neighbors’ homes. It might take the seller several weeks or even months to “get real” about their home’s actual worth and what the market will bear. LISTEN to your REALTOR if you want to achieve the Top Priority you discussed at the beginning of the process.

    Some sellers just want to test the market to see if there is interest before reducing their price to attract buyers. I don't recommend this strategy because it signals to buyers that the home has been on the market longer and is not selling, triggering lower offers.


  • Poor Marketing. This is my favorite. Many agents have no marketing plan other than to put the house on the MLS with a few poor quality photos and hope a buyer stumbles onto it. Yes, this happens all too often. Just look at any search site to see the haphazard way most listings are put together.

    Hire a Realtor who can represent your home to Buyers in a way that will get it sold quickly and for the right price. Be SURE to ask for their Digital Marketing Plan since they have to market where the buyers are, which is ONLINE!


Use Days on Market to see if homes (in general) are selling faster this year than last year in your city or state but not to see how long it will take to sell YOUR house.


 For that, you will need a Realtor who knows how to obtain and interpret the data in your neighborhood and give you a fair assessment of value and selling time.