Days on Market or Showings?

What’s a better indicator for a quick sale?

When I was an agent, I remember sellers always asking me: “What’s a better indicator of when our house will receive an offer: average days on the market in our neighborhood, or the number of showings?”

Based upon my training this is how I often answered:

Average days on market in a neighborhood doesn’t mean much, it depends on how the houses are priced. Let’s say the neighborhood has very similar homes–same approximate age, size, lot size, condition, etc. And let’s say that the market price for these homes is $300,000.

If all the homes are priced around $375,000 and have an average days on market is 200, then the houses are overpriced. But if yours is on the market at $300,000, it probably would sell reasonably quickly.

Here’s another example:  Three houses are on the market. One was priced at $300,000 which sold in 20 days. One was priced at $325,000, and it sold in 100 days. One was priced at $350,000 and has been on the market for 180 days. You could look at the averages: Average sales price of $325,000, average days on market 100 days,  but that really doesn’t tell you much of anything. What you need to know is that houses sold quickly at $300,000. They take quite a while at $325,000.And they may never sell at $350,000.

So, days on market really is just a function of price and marketing.

For my money, the number of showings was a lot more relevant. You can assume that most of the people viewing a property are looking for homes that meet the general description of that home (number of beds and baths, etc.) in that general price range. To use the example above, the people who are going to be looking at those homes probably want to spend between $300,000 and $325,000 on that type of house.  So, a lot of showings mean that your home is attractively priced for what it is and where it is. Few showings mean that your home is overpriced.

So, if there’s nothing wrong with a home (some terrible odor, or backing up next to a freeway that isn’t apparent in the listing), the more showings you have,  the more likely it will sell sooner. It’s all a numbers game. I know many agents who have various rules of thumb, such as: An offer should come in for every 10 or 15 showings. Obviously, the number varies. But you get the idea. If that’s not happening, then there may be some problem with the house that people don’t find out about until they’re actually looking at it.

So, the number of showings is a very good indicator while average days on the market in the neighborhood is a very poor indicator.

And….what’s the very best way to get more showings?      Pricing the property right!

Please leave a comment with your thoughts on this topic.

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