A Tale of Two Markets

Here’s a little tidbit that you won’t see in the headlines: April’s Days on Market statistic dropped 20% from March’s stat! What exactly does that mean? ‘Days on Market’ is a measure of how long the “average” house was on the market before it sold. So if we take all of the houses that settled in April, on average each was on the market for 82 days. Why is this significant? Because for the 3 months prior it was over 100 days.

In April 2006 the DOM average was 54. In April 2005? 15. Clearly buyers still have a much more comfortable window in which to make their purchase decision. But they have 3 weeks less this month than they did last month. What’s going on? Let’s take a look at the distribution of DOM for April in more detail.

What we see here is that half — HALF!–of listings are selling in under 30 days. Who are these ‘lucky’ sellers? Sellers who are in a good location, at a competitive price, have a house that shows well, and have wide market exposure. Another 19% who have some but not all of those things going for them sell in the 2nd month. So 3 out of every 4 sold homes sell in under 60 days. Not so bad for sellers! The message? There are plenty of buyers out there for the right properties.

At the other end of the bar graph, we still have those dog properties dragging the average down. Slowly but surely they are dropping–whether because the sellers finally came to their senses and dropped the price, or whether they’re just expiring unsold, I can’t say.

How do you make sure you’re one of those sellers at the left end of the graph? Hire an agent who is realistic about pricing, who helps you make the changes to your home to showcase it in the best possible light, and most importantly one who will spend the time and money necessary to market the property correctly. If you or someone you know is thinking of selling, please contact me to discuss how I can help you get your home sold more quickly.

Data Source: MRIS. All data believed to be accurate but not guaranteed.

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2 thoughts on “A Tale of Two Markets

  1. What are your thoughts on agents that pull listings off the MLS, just to relist them and reset the DOM? Does that effect these graphs?

  2. Good point, Frank. I used to see this a lot last year, and early this year. I haven’t seen it nearly as much since MRIS announced back in March 2007 that they were imposing hefty fines for agents who do this.

    (See http://www.mris.com/compliance/Compliance%20Documents/Days_on_Market.pdf)

    It’s nice to see that MRIS started to take it seriously (at least on paper), imposing fines of $1000 and up–and even suspension of MLS access–for habitual offenders. I haven’t heard anything yet on whether they’ve actually caught anyone though. I know I wouldn’t hesitate to point it out to them if I come across a listing where that appears to have happened.

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