Real estate statistics are frequently quoted in the news. But what do they really mean?
How familiar are you with these commonly used real estate terms?
DOM – Days on Market
The number of days a home has been listed for sale.
NOTE: if a listing has been cancelled and a new listing issued for the same property, often for a reduced price, the DOM count restarts. It is important to ensure your Realtor is checking old listings for the property, so the total DOM is accurately tracked.
Months of Inventory
The total number of properties listed for sale during a given month divided by the number of sales during that month.
If no other new listings were added, the amount of time it would take to sell all existing listings.
Type of Market: Seller’s, Balanced or Buyer’s
0-3 months of inventory: seller’s market (demand > supply, little choice for buyers, less negotiating power for buyers)
3-6 months of inventory: balanced market (there are a reasonable number of homes for sale that a potential buyer can choose from)
6-9 months of inventory: buyer’s market (supply > demand, many homes for buyers to choose from, more negotiating power for buyers)
Sales to New Listings Ratio
The number of property sales as a percentage of newly listed properties.
When more than 50% of all new listings sell, it indicates a seller’s market.
When less than 50% of all new listings sell, it indicates a buyer’s market.
The more you understand about the market, the more realistically you will be able to price your home to sell quickly or to submit an offer to purchase that is likely to be accepted.
Seek the advice of a knowledgeable Realtor!
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