Properties with great locations, perfect condition and priced at market value do not last on the market and thus their days on market are very short. You can use days on market (DOM) statistics as a way of determining what the market (read that – buyers) think of any one of these three variables. Typically, properties with a large DOM will command lower prices than a property with small DOM’s because buyers perceive the property as over priced or less desirable. DOM is often used when developing a pricing strategy. DOM can also be used as a “thermometer” to gauge the temperature of a housing market.That’s why you care about DOM.
Okay, so how is DOM figured? In simple terms, DOM is the number of days on the market that a property is “active” from the list date of the current listing. A home can be withdrawn from the market, a listing may expire or it may be taken “temporarily” off the market for completely valid reasons. The MLS stops counting days for any of the these reasons in addition to a property changing status to “under-agreement.” If a property then comes back on the market – BOM in MLS terms (a contract is voided for home inspection, financing, or some other reason) counting days resumes.
If a listing is taken off the market then comes back on the market more than 90 days later with a new MLS number the DOM is reset to zero but the MLS continues counting days from the first (original) list date – called Property History. Agents used to cancel stale listings and put them on the next day with a different MLS number and buyers would think it was a “new” listing. But those days are over with the transparency of the internet … you can find out the true DOM easily.
In a buyer’s market, the DOM are generally higher because inventory takes longer to sell. In a seller’s market, the DOM are fewer. In the current market conditions terrific homes in active price points are getting offers within 15 days. Mediocre homes in those same price points are taking 30-180 days. And fixer-uppers/as-is/dated/bad location/overpriced homes in those same price points are taking much longer. There are currently 20 homes on the market in Metrowest that have DOM over a year, and one even has 1696 DOM (I hope that agent doesn’t need a paycheck).
Bottom line if you’re a seller, bringing a house to market it is vital that you bring it to market in the best condition possible, with good marketing and priced right. Anything less than that may put less money in your pocket.
Bottom line if you’re a buyer, pay attention to DOM and use it as a negotiating tool. Knowing it may put money in your pocket.