There are no ifs, ands or buts about it, when buyers see extensive days on market; they figure the seller must now be desperate to sell. Buyers also begin to suspect that there might be something wrong with the home that has caused other buyers to pass it up.
Both of those assumptions, however, can occasionally be wrong. Homes can linger on the market for a number of additional reasons such as a seller’s motivation, not being available to exhibit and too little market exposure; but the most common reason is overpricing.
Overpricing is a common pitfall. The agent may have obtained the listing by misleading the seller into believing the home was worth more than the market will bear or sometimes the seller just wants to test the market in the off chance they find a buyer that is not as astute and may pay their wish price. Some sellers are just plain stubborn on what they believe their property is worth and are willing to wait out the market until it catches up. All of these scenarios are likely to cause the days on market figure to increase and in turn further diminish the appeal of the property.
Days on market is a measurement of the age of a real estate listing. The statistic is defined as the total number of days the listing is on the active market before either an offer is accepted or the agreement between real estate agent and seller ends.
Depending on the rules of the authority that is being used, the number is reset if a seller switches real estate agents. Sometimes there is also the arguably unethical practice of "withdrawing" the listing before it expires and adding the listing again to reset the days on market. As a result, when this statistic is used it is often lower than the true value. However, savvy real estate agents will research the property's listing history and can tell more effectively how long the property has been on the market.
Generally, properties with large days on market value will command lower prices than properties with fewer days on market, because a perception exists that the property may be overpriced or less desirable. Days on market often factors into developing a pricing strategy. Days on market can also be used as a "thermometer" to gauge the temperature of a housing market.