Home Listings: The Truth Behind 'Days on Market'

days on marketThe most common question buyers have about homes that have been on the market a long time is: "What's wrong with this house?" The best answer is probably: "The economy."

But the mindset lingers, and buyers are suspicious of homes that have been listed for a year or more. As a result, real estate agents sometimes will withdraw a house from the market -- just long enough to comply with their local MLS guidelines -- and then put it right back on with a new MLS number. In some places, they are able to reset the "days on market" clock to zero, so the house even appears to be a fresh listing.

Is it deceitful or just smart marketing?

Gracee Arthur, Ewing and Associates, Sotheby's International Real Estate in Malibu, Calif., minces no words: "It's fraud," she says. "They are trying to phony it up to make it look new and generate new interest. I'd bet that 90 percent of the time, buyers figure it out. All a buyer has to do is check the property's history on the MLS and they'll see how many hundreds of days this has been on the market." Another thing agents do is switch the listing to their partner's name so that it can appear in the MLS as a new entry, said Arthur.

Arthur adds that "days on market" has less to do with the home or condo and everything to do with the state of the housing market and the economy. She's seeing movement in the condo and second-home markets that have been dormant for two years. "Sellers are getting the price they listed at way back when. It took a while, but it's starting to happen."

Teresa Boardman, who sells in St. Paul, Minn., for St. Paul Home Realty, sees nothing wrong with freshening up a listing by taking it off the market and then putting it right back on. In St. Paul, an agent can re-list the very next day.

"It's marketing, not an attempt at trickery," she said. Sometimes she simply updates the online photos of the property, especially if it's summer and the outdoor shots are of the home deep in snow. "This isn't about trying to fool buyers. There is nothing wrong with a home that's been on the market for three years. There are some awesome bargains out there of homes that have been for sale for a year or more."

In addition to taking some new seasonally adjusted photos, Boardman also rotates the existing photos. Instead of the standard lead photo being the front exterior mug shot, she might show the garden or kitchen first. "A little change like this might catch the eye of someone who passed over the listing the first time."

The larger question may be why buyers tend to get more excited over things new to the market. Just because something is new to the market doesn't necessarily mean it's a better buy than properties listed a year before.

In many cases, said Arthur, owners of homes that have been listed for a long time are more eager to negotiate. But apparently knowing that a home has been listed for a long time sends different messages to different prospective buyers. If there have been no price drops, a buyer might read that to mean the seller is inflexible, so why bother making a lower offer? Another buyer might interpret the long listing as a signal that the seller hasn't seen any interest in his house and might finally be ready to negotiate.

While there's certainly nothing but anecdotal evidence out there, the prevailing attitude among buyers seems to be that new trumps old when it comes to listings.

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