DOM in real estate means days on the market. This is an important analytic tool that people use to help understand the value of a home. There are two important distinctions within this data:
- Active days
- Cumulative days
Active listings show when the seller signed with the realtor. Cumulative can be harder to find. While some multiple listing service (MLS) systems may show the total number of days, you probably must search for old listings to get the number.
You should take this data with other objective and subjective information to get a clearer understanding of what the house’s value is.
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How Long a House Has Been on the Market
You can find out how long a house has been on the market. Realtor.com and MLS.com both post this information in the listing. Sites like Zillow and Trulia also pull multiple listing information and display it in their listings. These sites all give you great information associated with how long the house has been on the market, such as:
- Original listing date
- Price change dates
- Last sale and price
- Fair market value
Each of these sites has good search tools, so you can search the neighborhood that interests you. Also, if you want to know about a specific house just put in the MLS number or the address.1
Difference Between Dom in Real Estate and CDOM
CDOM is a measure of continuous days on the market. Continuous is an important distinction because listings end. They are contracts, and they have set marketing periods. If the house doesn’t sell in that time period, usually 30 –90 days, then the listing expires. There are other reasons a listing ends, and the house is relisted:
- There is a performance clause in the contract that isn’t met
- The seller and realtor don’t get along and decide to part ways
- The realtor and seller may decide to relist the property to make it look fresh
The point is sellers relist properties for a variety of reasons. If you just look at the listing date, then you may not be getting the whole picture. If you are on a website read the full listing, because it may give you clues if the home has been on and off the market.
The best way to know is to work with a realtor because they can check the complete history of the house. They can see how many times a house listed, and what the listing dates were.
How is CDOM Measured?
The multiple listing service (MLS) measures CDOM by counting the continuous days on market counting different listings on the same property. Just looking at the current listing’s age does not tell the whole story. You should take the time to find out if the house was listed before. The reason is it gives you a good indication of the property’s value within the overall market.
- If houses in the neighborhood consistently stay on the market a long time, then it may be an indication of a seller’s market
- The owner of a specific house may not be motivated to sell and just want to see if they can get a high price
- Tenants may live in the property and make it difficult to show
- There may be something wrong with the structure of the property
- The property may be in litigation or probate
If the house you are interested in stays on the market for a long time it may mean there is something wrong with the property, or it may mean there is something wrong with the market. It’s very common for a homeowner to have unrealistic expectations about the value of their house. Realtors should help them understand the market or walk away from the listing, but many don’t.
On the other hand, if several houses stay on for an extended time in your neighborhood it may mean that the market is slow, and buyers in the area can negotiate more aggressively on houses.
Either way, this knowledge can help you negotiate the best deal for you. It can also help you decide if the seller is realistic about their expectations. While you may be able to find this information online, a good realtor can give you detailed information and an objective perspective on the house.2
Average Time on Market
Average time on the market means just that: it is an aggregate indicator of how long sellers advertise their homes before they sell. Realtors calculate this for neighborhoods, cities, states, and even the whole country to get an idea of trends going on in the market. Why is this important?
- Buyers and sellers both want to know trends to see how much leverage they have when they negotiate a price
- Combined with data on sale prices it gives a clearer understanding of what an individual house should sell for
The more information you have the clearer the picture becomes. The government and industry groups provide extensive, detailed data on markets, and they provide more data all the time. You should look at the numbers whether you want to buy or sell to gauge the market. A savvy realtor knows how to interpret the numbers and help you get a good deal.3
Finding DOM in Real Estate
Finding the days on the market today is easy. The internet offers a whole new way to find information, housing, too. Here are some ways to search:
- Type the address into the MLS, and current, as well as old listings, should pop up
- Some MLS systems even include cumulative days in the active listing
- Type the address into Google, and it should return old listings for the property
- Your realtor has access to old listings and will provide them if you ask
Add up the days under contract from the old listings and combine it with the new contract, and it will tell you the number of days.4
Final Thoughts on DOM in Real Estate
DOM in real estate is an important tool for you to understand the market. However, it is only one tool, and you should combine it with other data to get an objective idea of a property’s value. The government and industry professionals develop new data sets and analysis tools all the time to help better price homes. If you use these then you have a better idea about the true value of a house.
Good realtors stay current on the technology of the industry. They know the data and analytic tools. Make sure that if you hire a realtor, they are a qualified professional who understands how to use data to evaluate a property.
That, however, isn’t enough. Objective data is great, but it is not a substitute for looking at the house. Be honest about the condition of the house and the mood of the other party. This subjective information is just as important as the numbers.