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Now could be a great time to sell your home, but it’s difficult to predict how long it will take from when you list the property until it actually sells.
In 2020, buyer demand has been robust in many areas. There weren’t enough homes on the market, as inventory was low, so houses were selling super fast. However, the real estate market is always changing, so here’s what you need to know if you’re considering selling your home in 2021.
Residential properties in the U.S. took an average of 53 days to sell in October 2020, which was a 20% increase from last year. The actual time it will take to sell your home can be longer or shorter, depending on many factors, including asking price, location, the number of buyers looking for a home in your area, and other considerations.
What is “Days on Market” and How Is It Calculated?
“Days on market” (DOM) refers to the total number of days from the date when a property is first listed for sale to when it is officially sold. You can find the average DOM for a given metropolitan area each month by making a note of the day a home goes up for sale and counting the days until its final sale. Then add up all the days and divide by the number of properties to get the average DOM for the month. If you don’t have time to collect all that data, most real estate agents can provide this information for you.
Buyers pay attention to whether a home’s DOM is typical for the area, assuming that if a house has been on the market for longer than usual, it could be because it is priced too high. This assumption may lead buyers to make a lower offer or no offer at all.
Sellers should be aware of the average DOM for their area, and if their home is taking too long to sell, they’ll need to make adjustments. This can include reducing the price, making renovations, or perhaps, taking the property off the market before relisting.
Average Days on Market in the Houston Metropolitan Area as of October 2020*
In October 2019, the average DOM for the Houston Metropolitan Area overall was 43. That means that the average home here was sold 43 days after it was listed, a 20.37% decrease from October 2019. If you’re selling locally, you should aim not to stray too far from this number.
|Houston Area City||DOM|
*Data from the Houston Association of Realtors
Median Days on Market in Other Metro Areas nationwide as of June 2020
For comparison, here is the median DOM for each of the top 20 U.S. metro areas:
|New York City-Newark-Jersey City||NY-NJ-PA||78|
|Los Angeles-Long Beach-Anaheim||CA||61|
|Houston-The Woodlands-Sugar Land||TX||58|
|Miami-Fort Lauderdale-West Palm Beach||FL||114|
|San Diego-Chula Vista-Carlsbad||CA||39|
|San Antonio-New Braunfels||TX||65|
If you want to research another region, you can visit this page, click on the tab labeled “Days on Market Heatmap,” and select your state and county or metropolitan area to view its median DOM.
Factors That Affect Days on Market
Once you’ve found the DOM for your area, you have a number to strive for when selling your home. How can you go about keeping your DOM as low as possible? The time it takes to sell a house is based on multiple factors, some of which can be changed through a bit of effort, while others are out of the seller’s control.
Not surprisingly, homes with lower price tags tend to sell faster, but as the seller, you don’t want to go too low. Not only is selling your house for less than it’s worth unfair to you, but buyers will wonder if something is wrong with the property. Setting a reasonable price somewhere in the middle is key to making your house appeal to buyers.
Aside from price, buyers care about the location just as much. Suburban homes are the most popular, especially if they are in safe neighborhoods with excellent schools. Big cities are also known to have low DOMs. Rural areas usually take the longest to sell. Unfortunately, you can’t exactly change your home’s location, so there’s not a lot you can do on this front.
Local Market Hotness
On the topic of location, different areas have different market climates. A market will either have more buyers than sellers (a “hot” market), more sellers than buyers (a “cold” market), or be somewhere in between the two (a “neutral” market).
It’s easier to make a nice profit in a short timespan when selling your house in a hot market. Therefore, it’s essential to keep an eye on local real estate trends to determine your market’s hotness. If you notice that fewer houses in your area are for sale than usual, and they are selling quickly, that’s a good indication that your market is hot and now is a great time to sell. Conversely, if you see many houses for sale and no one seems to be buying, the market is probably cold, and it’s best to wait until it heats up before trying to sell your home.
Most buyers want an aesthetically pleasing house, so selling fast will require you to make your home look its best. This includes keeping its interior neat and organized, tending to your lawn and garden, or applying a fresh coat of paint. If the house requires extensive repairs that are too much for you to handle before selling, it’s best to be transparent and tell buyers upfront on what they will need to fix.
Buyers are more eager to house hunt during certain times of the year. Winter is the slowest time in real estate due to the holidays and the colder weather in many parts of the country. Across most of the U.S., late spring and summer tend to be the most lucrative times to put a house on the market.
Type of Financing
What financing method a buyer is using the purchase the home will affect the speed at which they can close. Homes that are financed using a mortgage take longer to close than a house that is being purchased in cash. With mortgage interest rates at record lows, mortgage companies are suffering longer processing times. Additionally, financed purchases typical require that the property purchase is appraised, which can add time to the process.
The Quality of Your Agent
It’s worth emphasizing that DOM only factors in how long it takes to sell a house after it’s officially listed. The time it takes between first deciding to sell your home and actually putting it on the market can take a while without the assistance of a knowledgeable real estate agent. If you’re selling in the Greater Houston Area, we highly recommend working with Roots and Wings Realty Group – a group of top Houston Realtors – who can help you achieve a quick and easy sale.
Need to sell your house fast?
If you need to sell your home fast, AMI can provide you with a free, no-obligation cash offer. Selling a home can be a long and stressful process. AMI buys houses nationwide and makes it quick and simple by purchasing your home in its as-is condition. You won’t need to make any repairs, there are no realtor’s fees, and AMI even covers your closing costs. Contact us today for your cash offer.