One of the most frequent questions Edmonton home buyers ask me when they get MLS listings information from me is "what does DOM mean?". This acronym stands for Days on Market - or how long the property has been listed. DOM is on almost all MLS listing information sheets. Knowing how long a property has been on the market can be a key indicator to its desirability if a home buyer knows how to correctly interpret it!
There are a lot of anecdotal beliefs that the 'best' time to get a deal on a home when buying is to make an offer within the 1st 7 days of a listing or the last 7 days of a listing. The belief is that there is more flexibility on the seller's end for some reason. Although I am not a proponent of this idea as a blanket theory, I can see why this theory is out there. A buyer who just lists could be convinced that a quick offer could save them further bank interest payments if the listing ran for 60 or 90 days, and a listing about to expire may have a 'now or never' feeling to it.
One key to DOM is when viewing recent sold homes in the area. This is because you will be able to see a living example of the age old idea of supply and demand at that homes price point. For example, if there are a large number of homes in a similar area at a similar price point, there is more likely to be a greater number of days on the market before a home sells. At the other end, if there are also only a few properties in a certain price point in a certain area (especially those at or under average home sale price at that time) then you will see the number of Days on the market smaller at the time of sale. Generalities for sure, but these are still good things to see if you a home buyer in a particular area.
A common question I get when someone sees a home listing with 70, 90, or 120 days on the market is "can you tell me why this listing has been on the market so long?. Well, the answer is both incredibly simple, and quite complex. A home is on the market that long because it is overpriced. Period. All other factors which can explain the lapse - having tenants occupying it, poor condition, bad area of town, bad time of year to sell, structural or health concerns with the home, special assessments being levied (in the case of a condo), anything - can all be rectified by a competitive price. So those complexities may be a factor to a degree, but at the end of the day it really is the price that dictates the length of the time a home is on the market.
DOM , or days on market, is a statistical indicator that can help give general trends regarding a home, but should not be looked at as a vital indicator. However, Edmonton home buyers should definitely make sure they understand what Days on Market means to help them make a great home buying decision!