SUMMARY: When a real estate firm sells after listing it for the second time, after not selling it the first time, MLS reports only the “Days on Market” (“DOM”) and the “Selling Price v. List Price Ratio” (“SP/LP”) of the second listing period.
When analyzing the potential selling price of a home, more data about comparable sold properties allows us to be more certain about our conclusions. When there is less data, we recommend a higher sales price to give our sellers a chance as a better outcome. Sometimes the home sells for this higher price, but sometimes a lower price and more preparation is necessary to get a contract. We explain this fully to our sellers before listing the home.
If we have done our best to market the home and realize significant adjustments need to be made in order to be successful for the seller, we withdraw it from MLS and get busy on the necessary changes. In these cases we typically advise the seller to wait a full 30 days before re-listing the home, because after 30 days, the “Days on Market” in MLS will reset to zero. We feel this is fair to our sellers, because the property is, in some significant way, a “new and improved” product deserving of a fair shot, untainted by previous “DOM”. In almost every case, thank goodness, we are successful selling the home on the second try.
In 2014, this situation occurred in 13 of our 134 sold listings = 9.7%.
With regard to how DOM is measured for these homes, some people think the total time the home was marketed should be measured, including any “Coming Soon” time while the home was being prepared before the original listing, plus the time of the original MLS listing period, plus the time while the preparation of the home was being adjusted between listings, plus the time of the second MLS listing period. As explained earlier regarding listings sold during preparation, we do not think it fair to count the “preparation time” against the listing firm, as long as it is legitimately for preparation on behalf of the seller. And it if was counted, listing firms would be motivated to stop marketing homes during preparation, which would be bad for the consumers, both sellers and buyers.
Some people think MLS has it exactly right for these cases where a home is listed twice, arguing that the “30 days off the market” is sufficient “penalty” for a seller to (delaying the sale of the home) in order to qualify for the clock to start over, and also enough time to pass in order for the home to be a different product relative to the changes in the rest of the market, even if no changes have been made to the property in question.
Others, think a compromise would be to total the “ACTIVE” times on MLS, and report that as the “DOM”. That way the listing firm is accountable for the first MLS listing period, but the seller is not penalized, as long as they are willing to wait an additional 30 days off MLS. If Hunter Rowe data were reported in this way, our average DOM for 2014 would be 22.5 days.