What if we remove the "Days on Market" field from all MLS listings?

Hmmm.... good points to both sides of the argument.  I find it interesting that in some markets the DOM is cumulative from agent to agent.  Over here, when a seller jumps to another brokerage, the listing essentially becomes a new listing and DOM starts at 0 again.  It's annoying when a seller switches agents just to freshen up their listing.

I wish I had found this group before I started another similar group!  I will join this one and try to catch up!

http://activerain.com/groups/MLSRulesNRegs

Very interesting points of view.  As long as the DOM in going to be in the MLS, at least it could be correct and consistent, which it is not currently.

Good points on DOA.  I too have often worried that DOM can result in DOA (Dead on Arrival)  when low ball offers come in simply because a home has been on the market a long time.  All you appraisers out there know that a lot of items determine value. Too many agents, buyers, and appaisers put too much weight on DOA. 

Hi, David
"Hell to pay" could equal having to buy the house back, pay triple damages to the buyer (AK) and/or having to deal with an ethics or surety fund complaint, etc. 

Out of curiosity, how you would answer a buyers question of "how long has this home been on the market?"  It might not be such an issue in the house were to sell in the early days of a listing, but at the point the DOM stretches past the norm (for the general market at the time the house sold) a buyer could  allege misrepresentation, even if you didn't represent the buyer.  
 
Let's say you list a house for $200,000... it languishes on the market for 187 days (average for your area at the time it sold is 84).  Buyer writes a near full price ($198,000) offer and closes but subsequently learns it had been listed for more than six months (first time buyer who didn't know to ask) from the neighbor.  Neighbor: "Man, this house was on the market forever... I didn't think they were ever going to sell it." The case could very easily be made that the buyer was damaged financially by overpaying due to not having been provided this information.

I just dealt with a property that sat on the market for almost a year. Would it have sold faster if DOM field didn't exist?  No, because the bottom dropped out of that segment of the market rendering the asking price too high buyers and other agents knew it.

Good discussion, btw.

I enjoyed reading your article.  The comments are good as well.  Why does everyone ask, when they come to an open house about the days on the market?  SO what?  I agree.

 

Hi, David

If DOM was truly confidential information we would have to take steps to ensure it was never revealed.  It would mean we couldn't put up yard signs because at the very least the neighbors would know when it was put up for sale... we couldn't advertise it in the newspaper or online because the dates could be tracked.  Those two examples alone would constitute a breach of confidential information.

DOM will only negatively impact a sale when the listing is aging... which begs the question "why is it aging?"  The simple answer is price.   I can't really speak with any authority as to whether your listings are over priced or not, but if they are languishing on the market beyond the norm for your area, the answer is probably yes.   DOM is just the effect; price is the cause.

You state in an earlier reply "As a consumer, if the price is wrong, the MLS DOM is naturally be longer.  (I think you just answered the 'are my listings overpriced' question) Does that mean that the agent is no good, or that the sellers are unrealistic in their pricing? During my 17 years of experience, I have witnessed that a long DOM is almost always the result of an over expectant seller, not a weak REALTOR®."

Market value is not dictated by what the sellers need or want from the sale.  Any agent that bows to the whims of an unrealistic and/or uneducated seller is most definitely a weak Realtor. 

All great points in your post Dennis. A wonderful debate. I'll speak in favor of keeping CDOM and DOM on the following points. 1. The buyers will find out if they want to know. Before we started keeping DOM records buyers (and agents) would commonly knock on the neighbors doors. 2. It's material fact, public knowledge, unless there is no sign in yard. Doesn't the seller sign and date disclosures at the time of listing that are made available to prospective purchasers that would reveal the DOM? 3. Information and facts are more important to a REALTORS job more than ever before. The more the better. From a buyers or sellers perspective, what do they need a REALTOR for these days but for more information.

Wow!  What a great discussion.  I can see merits on both sides.  After reading through the post and all the comments, I'm coming down on the side of full disclosure including CDOM so the system cannot be "gamed".  I think that visibility of DOM would not only help appraisers and buyers as has been previously pointed out but could positively impact sellers as well if we correlate actives pricing and DOM.  Armed with this information, it could help us advise our clients about pricing their properties in a quickly changing market.

I don't see "reason for selling" as material fact. Know one but the seller may actually know. The agent may not even know. Altghough buyers usually figure it out if they snoop enough. When a sign goes in the yard, ad goes in a publication, data goes in MLS,  I see that as public knowledge or "material fact". Maybe someone here can change my mind. Interesting debate.

David, I can certainly see your point of view and it has great merit.  For me, the scales tip in the other direction. 

To answer your question, as a listing agent my clients "reason for selling" is private information and kept confidential.  As a buyer's agent if I can get the listing agent to spill the beans (as they often do when you just let them talk) I'll absolutely pass that info along to my clients.

DOM on the other hand can be at least accurately estimated by other means.  That being the case, and for all the good reasons to have the number available, I'm for keeping it visible.

Like others, I certainly applaud your passion on the subject....but I fail to see the "big deal" about it. I cannot claim to have sold anywhere near the thousands of properties you have, so in comparison am a complete novice. However, isn't full disclosure the best policy? MLS also supplies room sizes and various other facts that may hinder full-price offers, should we take them out too? I understand that 200 days of market time isn't conducive to fielding top-dollar offers....but theoretic logic says if the house is priced properly and shows well that you're not going to run that time up, right? 

Great post to get the ActiveRain juices flowing!

When I first joined our MLS five years ago, DOM was no where to be found. A few years later, the Directors voted to add DOM to the full detail sheet along with the list date. If we print a custom detail, that information is not included.

I'd be all for removing DOM. You can back into a general time frame by the MLS number. Additionally, I like to keep on eye on the property history more than DOM - what was the property listed for initially? what is the property listed for now? Has the property been under contract and is now back active? Even as a listing agent, going to list an expired, this information is what I want to know, more so than DOM.

David- this is an awesome topic....one to really get the juices flowing, indeed! I'm looking at a listing that I'm going to show tomorrow morning: 98 days market time, $10,000 in price drops, bank owned, sold "as-is", 11x11 kitchen with vinyl floor: all things that couldaffect offer price. DOM is the least likely to affect it in this potential offer... Why would listing price adjustments be alright but not days on the market??? I'm certain if we surveyed active buyers and gave them these two scenarios that 'B' would get the lower initial offer:

A) Two homes of the exact same model in a subdivision with same everything  (general condition, appliances, flooring, upgrades, etc.) both still priced at their original list of $350,000....one has a market time of 98 days, the other 170 days.

B) A home that, regardless of market time, has dropped their price $40,000; from $390,000 to $350,000

**Would you claim that the difference in offer to listing price is going to be greater on the house with higher market time than it will with the substantial drops already???

"After all, the seller, my client, should just keep lowering their price or better yet walk away and let the bank take over?" YES!!! If a seller really wants or needs to sell a house and they and the Realtor did not price or present the home properly, it should drop! The funny thing about the market place is that homes are only worth as much as a buyer is willing to pay for them. You said so yourself, "We all know that a property sells because of one reason. Price. If there is an abundance of similar properties for sale, the seller must reduce their price."

DOM is just an indicator that the seller and Realtor didn't price or present properly to begin with. I understand that the market makes it very difficult for pricing pros to do so and that, currently, there is some measure of luck involved- but I think DOM is much less a hindrance than many other thing in the MLS listing. Thank you for provoking some thought to wake my brain up!!!!

David- I was a member of Realcomp and a Remax agent for 5 years in your market before moving North. During that time I saw office after office stop offering compensation to sub agents and Non Agents. They moved to only offering compensation to buyers brokers or a lesser comp to sub agents. Was this practice put into place to protect the seller? Real Estate One puts there disclosures on the web for everyone to see, with the date they were signed in plain view. Should disclosure statements now come after we have an excepted offer?

I can appreciate the other agents and yourself sticking up for Realtors, saying they are not the ones to blame for long market times, but a lot of the times Realtors are the ones that are making that mistake by pricing or taking listings that are overpriced. Without market times you are going to have an even harder time setting the proper price to sell the property in a timely manner. The inventories are to high to re-lie on solds alone.

I think a lot of big listing agents are upset that they are not in control of the market like they once were. And are having a hard time adjusting to younger, less expierenced agents that are working with buyers calling the shots. Could it be seasoned listing agents that controlled the inventory and to a certain degree prices do not know how to cope with this market or choose not to get into there car and work with buyers? DOM is not to blame, homes that are priced right from the beginning are still selling in a timely manner!  

The winners in Real Estate have always been the listors, now the listors that have the inventorys that still do not want to work with buyers are being past up. There costs are going through the roof and there reputations are being shattered. They have not learned how the new buyer has evolved and how to do business with them. Maybe this is part of the real estate adjustment.

 I guess you or know one in your office ever went to a listing appointment and bragged about how you sold a home in 1 day or a week. How about showing stats on the average days on market for your office compared to another office to precure a listing?