Southern Maryland Best Buys


Days on the Market...Why it is important for Ann Arbor Area and Yours.

The stats give the story every time!


1+1=2  I am not a math geniusThis is NOT hard...........I am not a math person, and I have found this easy to use. It helps when listing homes to be able to tell a seller a resonable time to get the home sold.


1. Days on Market (DOM). Average days on market is critical to your seller client for several reasons:

  • it's important in setting realistic expectations about the time needed to sell a home; i
  • t will help you evaluate any offers that come in and make an educated decision about whether it's advisable for the client to wait for another offer or take what's on the table;
  • if you know the DOM for your market (or, better, yet, for the client's neighborhood), you'll be able to guide him or her through the process.

Real Estate Market Chart by Altos Research

Most MLS databases have a much-manipulated DOM number which is invariably skewed low.

Some agents withdraw and re-list, right?

So how can you know what the real number is?

Is it possible to determine the actual DOM for your market even if you're not a rocket scientist?


Just use the absorption rate to calculate the true DOM for your area. Let me explain.

Here's how you get the real DOM.

  • Find out how many homes sold in your market last year and how many are currently on the market.
  • For example, if 10,000 homes sold last year, and there are currently 5000 on the market, what those numbers indicate is that the inventory turned twice last year (10,000/5000 = 2.0). Now, there are twelve months in a year, and 12/2.0 = 6.0, which is the absorption rate, meaning that the average time actually on market is 6.0 months.
  • So to convert the absorption rate to days on market, you simply multiply this last number by 30 (6.0 x 30 = 180). 

If you figure DOM this way, you'll eliminate all manipulation in your market by builders and agents who re-list stigmatized homes, which of course are those homes that have picked up a negative image due to their excessive time on market.

Use this for the neighborhood the home is in you are listing.

Real Estate Market Chart by Altos Research

2. Average Markdown (List to Sale Ratio)

  • You need to be able to advise your client as to the "typical" discount in your market. Let's assume that the average listing price is $175,000, and the average sale price is $169,000.
  • subtract the average sale price from the average listing price, and then divide the difference by the average listing price.

$175,000 - $169,000 = $6000

$6000/$175,000 = 0.034, or 3.4% markdown

You will look smartIn other words, your client should understand that it's normal in your market to expect a markdown (or discount) of 3.4% from the listing price.

  • Setting expectations shows him that you understand the market and that you'll help prepare him for the offers that will be coming in.
  • You'll also have an advantage in negotiating with other agents when you know that the average markdown in a certain neighborhood is only 0.5%, while they're offering 4% below the asking price!
  • You can tell an agent that it's unreasonable to expect your client to accept such a figure and that he should encourage his client to make a more reasonable offer.


KW LogoMissy Caulk & Team can be reached at 734-216-2822 or email:

Our TEAM of 6 buyer associates are available to help you relocate to Ann Arbor, Saline, Dexter, Chelsea, Milan, Ypsilanti Township, Clinton, Manchester, Whitmore Lake, or throughout Washtenaw County, MI.


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