How Some Officially Reported Data is Misleading and Why You Need to Know the Truth
March 24th, 2008 categories: Buying Your House, For Agents, Market Data & Statistics, Ridgefield, Selling Your House, Talking Real Estate
I am about to share with you one of most important, yet most elusive, real estate market statistic: Days-On-Market (DOM).
No one can miss the media hype about crashing real estate markets, the sub-prime lending mess, and foreclosures. What we’ve seen here in the current Ridgefield, CT real estate market, however, doesn’t really match any one of these headlines.
The Ridgefield real estate market has not crashed, in fact we conducted 3.7% more sales in 2007 than in 2006 with just a minor softening of prices. The sub-prime mortgage situation has only indirectly effected our business in that lenders now require more documentation from borrowers. And we’ve only seen a handful of foreclosure sales, nothing extraordinary.
So what has changed? It can’t be business as usual, can it?
The biggest change I’ve seen in the current Ridgefield real estate market is that it’s taking longer for homes to sell. How much longer? Well most agents can’t really tell you.
Anyone can share with you what’s reported in the MLS. On this measure, though, the MLS-reported DOM is misleading, absolutely useless. Let me explain.
- The MLS calculates DOM based on each particular listing.
- The MLS “resets the DOMO meter” when the seller change agents.
- Many Agents game the system by re-listing the same property multiple times thereby constantly resetting the DOM meter.
As far as I know, we are the only real estate office in Ridgefield that calculates the True DOM. It takes a lot of effort and skill but we do it because it is such an important market indicator. We want to be certain that you (buyers and sellers) have the most important, most up-to-date and most accurate market data available on which to base your real estate decisions.
True Days-On-Market
| Year | Average ACTUAL # Days on Market TRUE DOM | Average DOM per MLS |
|---|---|---|
| 2007 | 211 | 99 |
| 2006 | 157 | 84 |
| 2005 | 116 | 66 |
The real story shows a market time much longer than “officially reported”. Sellers need to use the real numbers to set expectations and adjust listing prices. Buyers must be aware of a property’s entire listing history not just the current listing and what is reported on the MLS listing sheet.
The Kimmelman-Gutman Group believes that we must be real estate market masters for our clients. Dig deep into the data, understand it, be the local real estate economist. Only then can we provide you the best service and value. Contact us if you’d like to learn more.
Related Posts:
- Grab your Pick Ax Now! Why You Need to Mine Nuggets From Ridgefield’s Mountain of MLS Data
- How Is The Ridgefield, CT Real Estate Market?
- Why 2007 Was A Great Year for Ridgefield, CT Real Estate
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View Rob's profile
It is always interesting for me to see how MLS data is reported in other markets. It makes a compelling argument for a more national type database. In the Denver area MLS, they changed the DOM
reporting a couple of years ago. We were experiencing the same problems you are with inaccurate reporting. Now, we have two fields: DOM and TOTAL DOM. That way, if the property has been relisted with
a new broker, the TOTAL DOM is still counting. There are still ways to game the system - like take the property out of MLS for 30 days, but it’s a more accurate method of reporting than it used to be.