Ask any real estate agent: When a house has been on the market for a long time, potential buyers figure they can drive a harder bargain. And, of course, homes are staying on the market a lot longer these days. It would make Realtors’ jobs a lot easier if would-be buyers didn’t know how long properties had been up for sale.
Consider that fact in light of a recent announcement by the Southern California Multiple Listing Service that it has decided to remove “days on market” and “cumulative days on market” data from all client reports. (The cumulative figure sums up the number of days of the original listing and subsequent relistings.)
The decision has already generated some complaints, including this one from eFinanceDirectory.com, which wrote:
Knowing how many days a home has been on the market is an important piece of information for buyers, but thanks to a new ruling, real estate agents are now able to deprive interested parties of this crucial data.SoCalMLS says that it's not trying to conceal anything, and that MLS members are free to give the days-on-market data to clients. They just want to be able to put the numbers in proper perspective. Here's part of a statement on the MLS's website:
The bottom line is that you, the real estate professional are in the best position to explain to your customer - buyer or seller - what the true DOM figure is and what it means.
To that end, the SoCalMLS BOD, after getting input from MLS Committees and other practitioners, have decided to remove the DOM and CDOM fields from all Client reports. You will still have this information available to you in the Agent reports, which also link to the history report for each listing. The history report gives you a much more precise overview of what transpired for a particular listing. With that ammunition you should be prepared to better explain to your client the ramifications of the DOM data.
The truth is that days-on-market figures are subject to manipulation, as I've written in the magazine and on this blog. Wrong figures are worse than no figures at all. But yanking the data off of client reports is the wrong response. At a time when Realtors around the country are being investigated by federal and state authorities over potentially anti-competitive practices, removing days-on-market data from client reports seems like a step in the wrong direction.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.