There is frequent discussion about Days on Market data and how that relates to a property’s value and marketability. Real estate appraiser/guru Jonathan Miller describes his approach to the Days on Market. If you are a Realtor, MLS person or buyer or seller, you would do well to read his post. While Days on Market does not draw a clear correlation to market value, it can help start the line and add insight into the Seller’s motivation.
When I review active listings in a particular market, I look at the days on market before I consider finer property nuances like condition, layout, room count and so on. It provides clues to the upper limit to value, helping define the possible value range of a property whose value we are estimating. The same goes with sales that closed. I want to understand how the property was accepted. (bolding his)
Our MLS is in the process of developing/implementing a “continuous days on market” category to make tracking this data more accurate. Yet, we still have to depend on Realtors (the weakest link), who generally do not recognize the value the MLS data, to input correct information. Understanding the data is one thing; understanding its limitations is another.
Side note: I wish our MLS provider would practice the transparency that this MLS provider does; the insights are invaluable.
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It’s less about the house and the price as it is about the seller getting sick of trying to sell it.
testing to see if I’m spamboxed here too…
It’s less about the price and house, than it is about the seller getting sick of trying to sell the house. After a while many sellers just want to complete a deal no matter what.
Athol
Athol –
You’re good to go. I would think I have de-spammed you enough times that Askimet would have learned by now …
The DOM number can help determine just how ready to complete a deal the sellers are. (how’s that for a confusing sentence)?
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As appraisers there are more items to days on market for us. We are required by many of our clients to report the days on market. We are required to report accurately and not in a miss leading way. The days on market for our clients is a tool used should they be a lender that may need to take the property back and they are interested in knowing what the exposure time is. Often times we find that the MLS systems distort the days on market or refuse to disclose actual days on market making our job harder and requiring us to disclose to our client that the information may not always be relied on. To many sales brokers and agents in our area use the days on market as a tool to harvest new business by showing the new listing homeowner that they hold low days on market. It is vital to show the actual days on market not just for appraisers but also real estate people working to put together an informative CMA. The only other area that we have problems with is concessions and the reporting of actual data.
Very well said, Apella. Both the CMA and BPO form include DOMs for listings and sales. Currently, I look the information up manually.
Unfortunately, MLS data is used for more than buyers and sellers. Some Economists use the data to compile reports:
http://www.nsdcar.com/homedex/current_homedex/current_homedex.pdf
Just a note on DOM statistics from CAAR and other sources. We have been tracking properties in the Charlottesville area for a couple of years, with the intention of buying, eventually. Out of 29 properties that we have followed, 17 have had two or more distinct MLS numbers. (That’s approximately 59%, and the true percentage is probably much higher, since some of these are recent listings.) So any published figures on DOM are completely bogus. A buyer’s agent who does not research prior listings and report the true data to his/her client is not doing a competent job.
Potential Buyer –
Thank you for visiting and commenting.
Amen and Amen.
As a note, our MLS is in the process of implementing a “Continuous Days on Market” feature that will track the true Days on Market. that should make it easier to see the true data, but, nothing will be able to make up for a lazy or incompetent person interpreting the data.
P.S. I know a good Buyer’s Agent. 🙂
We have a DOMM and DOMP. THey are attached to the tax records. One covers just that listing, the other covers a) same agent relisting and b) multi agent listings.
I’ll be running a report shortly to see if there is a correlation with DOMP and % of ORIGINAL sales price (not just latest list price).
Thanks,
Frank
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