What Is DOM in Real Estate and Why Does It Matter?

Days on Market (DOM) is a real estate metric, representing the duration a property has been actively listed for sale. It gauges how quickly homes are selling in a particular area or for a specific property. Understanding DOM helps buyers and sellers make informed decisions in the market.

Understanding Days on Market

Days on Market is calculated from when a property is first listed as “active” on a Multiple Listing Service (MLS) until an offer is accepted and the property goes under contract. It counts calendar days. For example, a home listed on July 1st with an offer accepted on September 15th would have a DOM of 76 days.

While DOM measures the current listing period, “Cumulative Days on Market” (CDOM) accounts for the total time a property has been on the market, even if delisted and relisted. This provides a more complete history of market exposure.

Interpreting DOM for Sellers

A low Days on Market indicates positive factors for sellers. It signals strong buyer demand, competitive pricing, and a well-maintained or desirable property. A quicker sale at or potentially above the asking price is more likely when DOM is low.

Conversely, a high DOM suggests challenges for sellers. It may indicate the property is overpriced, has condition issues, or limited buyer interest in the current market. A prolonged time on market can lead to buyers questioning why the property has not sold, possibly resulting in fewer offers or price reductions.

Interpreting DOM for Buyers

For buyers, a low Days on Market means increased competition. Buyers may need to act quickly and be less aggressive with their offers, as there is less room for negotiation. A fast-selling home suggests high desirability and a fair or attractive price.

A high DOM presents opportunities for buyers. It may signal less competition, allowing for more negotiation on price or terms. However, buyers should exercise due diligence to understand why the property has remained on the market, as it could point to underlying issues with the home or its pricing.

What Affects Days on Market

Several factors influence a property’s Days on Market. Pricing is a determinant; a home priced correctly relative to its market value tends to sell faster. Overpricing can extend the time a property spends on the market. The property’s condition plays a role, as well-maintained homes with desirable features attract buyers more quickly, leading to a lower DOM.

Local market conditions directly impact DOM. In a seller’s market (high demand, low inventory), homes sell faster than in a buyer’s market (low demand, high inventory). Desirable locations see lower DOMs due to consistent demand.

Effective marketing, including professional photography and broad online exposure, can reduce a property’s time on the market. Seasonality affects DOM, with certain times of the year, like spring, seeing faster sales.