Understanding Days on Market (DOM) and What It Indicates About Market Health
Days on Market (DOM) refers to the number of days a property has been listed for sale before an offer is accepted. It’s a key metric in real estate that provides insight into the speed at which homes are selling and can indicate the overall health of the housing market.
– Low DOM: When homes are selling quickly and have a low DOM, it usually signifies a strong seller’s market. This means there is high demand, limited inventory, or both, often leading to competitive bidding and higher prices. Buyers need to act fast in these conditions.
– High DOM: Conversely, a high DOM suggests a slower market, often referred to as a buyer’s market. This could mean there are more homes available than buyers, leading to longer selling times and potentially more negotiating power for buyers. It may also indicate that sellers need to adjust pricing or improve property conditions to attract offers.
DOM is a valuable tool for both buyers and sellers to gauge market trends and make informed decisions. For sellers, understanding DOM helps set realistic expectations for how long it might take to sell a home. For buyers, it can indicate the level of competition they might face and how urgently they should move on a property they like. In general, monitoring DOM across the market can give a clear picture of its health, with lower averages signaling robust activity and higher averages pointing to a slower pace.
Graph of Louisville area Days on Market end of July 2024.
