What is the average number of days on market in your area? Why should it matter to you?
Real estate is full of tricky terms and concepts that might take a while to wrap your mind around. The days on the market doesn’t have to be one of the difficult ones.
Let’s take a look at six FAQs about days on market and what it means for you as a seller.
1. What do days on market mean?
The number of days on market (DOM) is how many days a home is listed for sale. The average DOM can vary significantly depending on the region, the health of the market, and even the time of year.
As a seller, the average DOM for your area gives you an idea of what to expect when selling your home. It’s not a guarantee that your home will sell in that timeframe, but it gives you something to work with.
2. Why do houses stay on the market?
There are many reasons why houses stay on the market. Some of them include:
- An overpriced listing
- An underpriced listing
- Needs major repairs
- Something undesirable about the neighborhood
- The market is slow
- Often unavailable to show (perhaps tenant occupied)
- Poor handling by the agent
As you can see, there could be something wrong with the property or it may have nothing to do with the property. Perhaps you made a mistake when deciding on the crucial listing price.
Regardless, it’s not a good thing if your home sits on the market for longer than the average in your area. Buyers will believe there is something wrong with your house (even if there isn’t).
Alternatively, they may also believe you will accept a lower offer because time is dragging on. Homes that sit longer on the market tend to sell for less than their asking price.
3. How do you reset the market days?
For this reason, some agents and sellers look to reset the DOM. They don’t want buyers to be suspicious that something is wrong or give lowball offers.
Agents will take the listing off the market and then relist, often at a different price. However, their main goal is to get the DOM back to zero. Not everyone agrees that this is an ethical practice. Some real estate agents refuse to do it because using this trick frequently can damage their reputation.
4. What is the difference between DOM and CDOM?
To make this workaround harder for sellers and agents and give buyers a more honest picture, some MLS associations list both DOM and CDOM. This is days on market and cumulative days on market.
For example, if a listing is on the market for 60 days, the agent may decide to take it down and relist. Let’s say it has been on the market for 10 days with the new listing. The DOM is 10, but the CDOM shows 70.
To reset the CDOM, you have to take a home off the market for a full 90 days. Then it will appear as a fresh listing.
5. When should I lower the price of my house?
There are a lot of things to consider before lowering the price of your house. Multiple price reductions signal two things to buyers: there may be something wrong with the house or you may be willing to go even lower. Thus, you want to keep the number of price reductions to a minimum.
Before lowering, consider the following:
- How many hits has your MLS listing received?
- Are the marketing materials truly selling the home’s best features?
- Are you getting showings?
- Have you had open houses?
- Is the market simply too slow or has too much inventory?
If you feel like the marketing campaign isn’t strong, perhaps it is time for a new agent. If the market is sluggish and you can wait, try taking your house off the market and relisting once things pick up.
If you think that the problem is truly the price, then discuss with your agent how much to knock off the asking price. Drop it too much and you might sell quickly, but for much less than you could have.
6. Should I take my house off the market in winter?
It’s no secret that in many areas of the country the housing market is slower during the winter. The cold, the holidays, school being in session, and many other reasons keep buyers in short supply.
However, this isn’t always true. Talk with your agent and take a close look at the data. How much does the market really slow down in your area? Is your listing strong enough to make a winter sale likely? Is it likely you’ll have to accept a lower offer?
Sometimes, it doesn’t make sense to take it off — you can still sell it with a little extra effort. However, you may want to for personal reasons. Perhaps you don’t want buyers tramping through your house during the holidays. If you do take it down, consider giving your listing a 90-day break so it appears as a fresh listing in the spring.
The Right Agent for Your Listing
Hiring the right agent is one of the best ways to ensure your home doesn’t sit on the market. You need a motivated agent who knows how to market and can get your listing in front of the right buyer.
Picking a name from a list on Google isn’t the best way to find that agent. At Clever, we only work with the best in the business. Thus, the agents we can connect you with will put their all into selling your home before the listing goes stale. Plus they work for a discounted listing commission.
Find out more about listing with a Clever Partner Agent here!