Days on the market, what does it really mean?
Updated: Apr 27, 2021
If you follow any real estate agent, brokerage, or see real estate ads, you will see that many real estate agents and brokerages make a reference to “days on the market.” Days on the market is about the average days on which a property is available on the market before it sells; just like any number or stat, understanding what it means and breaking it down properly will help you best understand how this stat affects your property.
I recently saw a social post of a realtor who made the note that their average days on the market in 2020 was 32 days; a very impressive number that is reflective of the current market conditions in Saskatoon’s residential sector. Yet, if you don’t breakdown the number further, as a seller, you may set yourself up for a sense of false hope when you list your property with this agent or any other realtor for that matter. For example, I saw another social post that indicated an industrial property sold within 30 days of being listed with a company: again, another impressive feat. However, that property had been listed on the market for a few years and the buyers had previously toured the property 6 months prior; a bit misleading of the situation in the way the sale was advertised.
Any market can be broken down into segments, for the purpose of this article we will break it down into condos ($200k - $350K), luxury homes ($800K+), single-family homes ($350K-$799k). If we analyze the condo market, there have been well-priced properties in desirable locations that have not sold in over a year. I have followed a property for the past 6 months that is $60K underpriced, and yet it sits on the market. Luxury homes are higher-priced items that have fewer potential buyers. Selling a luxury home will generally take more time, due to fewer buyers, and buyers willing to spend that type of money also willing to build their own home that is customized to their every need; thus another factor contributing to higher days on the market for this segment. The present “sweet spot” on the market are single-family homes listed between $350K - $600K; homes in this range are selling much faster and have low days on the market. So, a realtor that solely deals in this segment will have much lower average days on the market than an agent who mainly sells condos or luxury homes.
So what does this all mean? It is great to know what the average days on the market are because this type of information gives you a pulse on the market. However, as a seller, be mindful of the days on the market for a property similar to yours. Compare apples-to-apples, not apples-to-pears-to-oranges. The better understanding you can have of the days on the market relevant to your property segment, the better you can set your expectations as a seller as the last thing you want is to expect to sell your property in 32 days when the reality is that your property type may take 60 or 90 days to sell. However, with any real estate listing, the buyer for your property may become available today that there is no true metric to determine when or how fast your property will sell. If you are looking to buy or sell your home, don't hesitate to contact me today to see how I can help you with all your real estate needs. Contact information:
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