Sold stickers are appearing on signs a lot quicker than this time last year. So far in August (Aug 1-17), single family homes have averaged a Days on Market (DOM) total of 41 before selling. That’s a full week earlier than last August during the same period.
Condo-Apartments and Townhomes are also selling quicker – but not by as much. You can view those stats and more here.
The Days on Market statistic isn’t a great reference for determining how long you might expect a particular property to take before it sells; that varies greatly depending on the community, price range, and features of a home.
What the DOM stat does give us is insight into Calgary market trends in general. There are fewer homes for sale than this time last year, and sales are higher. It makes sense that homes are selling quicker.
There are some important things to consider regarding the DOM statistic. When a listing on MLS expires or is terminated and then relisted, the DOM clock resets to zero. This can happen several times throughout the history of a listing or never at all.
That’s why it’s so important when looking for a home with your buyer agent that they provide you with the entire listing history of the property – not just the DOM. For example, below is a sample screenshot of what we are able to pull up on our system. Do you see how much more information you can glean by looking at the history rather than just being told, “it’s been on the market 30 days”?
Legend: A=Active, P=Pending (C/S), S=Sold, X=Expired, T=Terminated, W=Withdrawn, U=Under Contract (Same as Pending, but still visible on MLS)
Days on Market & Home Sales
An interesting report was published earlier this year in the US. Below is the abstract:
In April 2006, the real estate listing service in Massachusetts adopted a new policy that prohibits home sellers from resetting their properties’ days on market” through relisting.
We study the effect of this new policy on home sales along the Massachusetts-Rhode Island border, using homes in Rhode Island, which did not change its relisting policy, as the control group. We find that Massachusetts homes that were on the market at the time of the policy change suffered an average reduction of $16,000 in sale price relative to their Rhode Island counterparts.
Homes that were revealed to be slow-moving suffered a greater reduction, but fresher listings only had a small increase in sale price. One reason is that some buyers were unaware of sellers’ manipulation of days on market and were thus unable to recognize home listings that were authentically fresh. A direct homeowner survey confirmed that buyer awareness was indeed lacking. Sellers reacted to the new policy by lowering their initial listing price to sell fast. However, in towns where listing price history was more transparent, sellers set a higher listing price to dampen the negative signal of slow sales.
To download the research paper, click here
When working with my buyer clients, I give them all the information at my disposal to help them make informed decisions. Feel free to contact me by email: email@example.com or by phone at 403-554-2284.