Academic

In Search Of Days On Market Data For Home Sales

By Dan Filler

A rational investor presumably seeks out all the available data about housing markets.  One paticularly alluring piece of information, it seems to me, is the national days-on-market average - the mean time it takes to sell a house.  Studied over time, this average might tell us as much - if not more - than average sale prices for homes. For some reason, though, it appears that this number is unavailable. 

That's not to say it's not discoverable.  The National Association of Realtors (NAR) appears to regulate almost all of the multiple listing services (MLS) that compile, analyze and share for-sale listings in each region .   We know that MLS collects days-on-market data and agents clearly know how long a particular property has been on the market.  And I'm guessing that within any local MLS, somebody can produce running averages.  Maybe - just maybe - NAR may even have this data.  If it were crucial to obtain national days-on-market data, I'm again guessing that some figures could probably be produced rather easily.  (Whether archival data would be easy to retrieve is a different question.)

So if the markets would like this information, and it's obtainable, why don't we have it?  It seems fair to infer that Realtors don't want it out there.  I'm not sure why that would be true.  In a weak  market, it might keep people from putting houses on the block - but in a strong market, the opposite would seem true.  In a weak market, buyers would bid very low (something they're already doing if their agent tells them how long the house has been on the vine) - but in a strong market they'd bid high.    Perhaps I'm wrong; maybe there is no practical way to assemble a quality dataset.  But I'm dubious, and I wonder what I'm missing in this picture.

Full post as published by The Faculty Lounge on March 25, 2008 (boomark / email).