Days on Market or Market Time
You will hear the two terms used synonymously. Days on Market or Market Time is the number of days your house is marketed before receiving and accepting an offer to purchase on your home. You list your home on July first and do not receive an offer until September 15 you are looking at 76 days on market or 76 days market time.
I read a post of Chicago Real Estate Agent Mike Cuevo, The Importance of Market Time. After reading the post by Mike it prompted me to relate days on market in our area of Massachusetts and how Days on Market can impact the sale of a home. I couldn’t agree more with the points he made with this article about market time.
Days on Market Analysis
I decided to track the sold homes for Dracut MA Real Estate. The criteria was all the single family homes that sold in the past 120 days and what impact did the Days on Market have on the sale price to the original list price as well as on the median house price. The analysis encompasses 110 homes in total.
|Days on Market
|Percentage of Sold to List Price
|Median Sold Price
Conclusion of Days on Market Analysis
So this little Days on Market analysis, shows what real estate agents have always known. Selling your home in the first 60 days is vitally important to receiving as much net funds from your sale as possible. If you can get it under agreement in a week that could even net you more. I have done this analysis before and the data always lines up has similar results. The swing on the median sold price is on the drastic side. I would not always expect such a wide range. But it does go to show you that the median sale price trends downward.
If you can sell your home fast it can provide you with many advantages, including financial.
It is easier than you think to sell your home fast. A real estate agent that is experienced in listing homes will walk you though the process of preparing, pricing and marketing your home for a quick sale. Most of my homes sell in well under two months and it is though a collaboration between me and the seller.
So how does Days on Market impact the sale of my home
The impact Days on Market, has on the sale of your home is two fold. One is the psychological factor it has on buyers. The second is the life cycle of a home for sale. They are both intertwined with one another.
Lets discuss the life cycle of a home for sale. The graph below is a very typical scenario that I see over and over again in one form or another. This or a similar pattern is repeated not only in the showing activity but also in the online views of a home for sale. The interest is high in the beginning, sometimes it take a week or two to ramp up then after week 6, 7, or 8 the showings start to drastically slow down. Why?
Its quite simple, the buyers coming through the door as soon as it comes on are typically your best buyers. They are working with an agent, they are pre-approved and they have flt pain in the market place they are the most motivated buyers. They have rejected every home out in the market place and they are waiting for the next new home to come on the market. They have felt pain, through lost offers, failed inspections they are tired and want to buy a home. They are educated on what they need to do to buy a home.
Then showing drop off and you will see the showing are typically from buyers just entering the market place. They are using your home to educate themselves about the real estate market.
The other impact is psychological. When a home is new to the market, there is excitement, this could be the one. If there is a lot of activity, the buyers notice. It is human nature for people to want and desire what others want and desire. Buyers will compete to buy your home early on in this process, it is almost guaranteed.
Homes are not like cars. They are unique, generally no two are exactly alike. If they miss an opportunity to buy your home, they will probably never have that chance again.
Now if you sell your home in the first 30 days, then great your probably received the highest amount you could for your home in a given market. The you pass the 60 day mark and then the 90 day mark. What happens?
Again the pack mentality kicks in. Whats wrong with this house, no one is buying it? There has to be something wrong. If no one else wants this house why should I? Your house is experiencing market rot. This is a term I use for a perfectly good house that isn’t selling. It is not physically rotting, but in the eyes of the buyers it is.
How do I keep the Days on Market down when I sell my home?
For most houses it boils down to pricing your home properly for the style, the condition and the location of the home. If all of those fall together properly you should have a successful home sale in under 30-45 days. Happy house selling!!
This post, Days on Market, how does it effect your home sale? has been provided by Kevin Vitali of EXIT Group One Real Estate. Think of selling? I would love to sit down and talk with you. I bring 12 years of experience to the successful sale of your home. Call me at 978-360-0422.