Buyer Seller Tip #8 -Using Days on Market As a Hack
Timing is everything and in real estate it can mean the difference between thousands upon thousands of dollars.
As a Realtor, I am continually looking at how long a property is on the market. By looking at the number of days a listing has been on the market I can learn a lot about what is going on and if it is a property I can recommend my clients buy.
For sellers in Southern California, the longer a property is sitting on the market the less desirable it becomes. Long Days on Market (or DOM as we call it) indicate problems. The number of homes for sale in Southern California is historically low, lower than most parts of the country.
This low inventory collides with high buyer demand. Southern California with it's high paying jobs and amazing weather continue to draw would-be homebuyers despite prices.
High demand and low inventory makes for very fast transactions. From the time it lists to an accepted offer, it could be as low as a single digit DOM but it varies based on price (see chart)
If the Days on Market are high, it bucks the trend, but why. Two factors will cause a high Days on Market. The property could be in significant disrepair (and I am not talking about needing a bathroom or kitchen refresh) or it could be price. Overpricing is the number one cause of a high number of Days on Market.Sellers should look to avoid the emotional influence of over-pricing a home. The advised strategy these days is to price under what an intelligent valuation states. Intelligent valuations are not Zillow Zestimates but a more in-depth report that looks at comparable homes have sold for in the direct vicinity and adjusting based on property conditions.
Buyers can use the Days on Market as a search hack as well. If the property has been on for an abnormally long DOM, then it is most likely overpriced and could represent a seller is not willing to budge. Limit your searches based on Days on Market.
See the full Pasadena Q1 Days on Market Report by House type and Price range. HERE or reach out direct if you have a specific question regarding Days on Market.
For more real estate buying strategy, download the Free Buyers Guide that I have put together. It includes a proven strategy on how to become a homeowner in and around Pasadena and Los Angeles.