Manipulation of days on Market (D.O.M)

[cyphire]

One thing that I have noticed lately is the direct manipulation of the Days on Market. We all know of the Median Price debate, but what about the obvious manipulation of days on market?

In a recent flyer I received from a Realtor in Olivenhain, I noticed that they are showing the days on market at 44 for a property which has not sold since January. Every couple of months this house changes brokers, or just changes the days on market. Anyone looking at this house would think that it just came on the market a month or two ago. When in fact it has been on the market for over 180 days.

What really got me upset (I hate seeing bad data, and more importantly relying on bad data) was that the Prudential office quoted:

“Another positive sign in North San Diego County is the median days-on-market decreased to 43 days in May 2007 from 50 days in April 2007, and the average number of days on the market fell from 74 in April 2007 to 63 in May 2007.”

I called the broker about their misleading adv. and she told me that they have a disclaimer that “Recap information from the National Association of Realtors and DataQuick Information Systems”. She also said that they have 8 homes in escrow so things are great in the north county. I asked her about the specific properties (including one which sold after 7 months or longer and shows 40 days), she said that they use data from the MLS and that if anyone asks about a property she will do a full search for them. I told her that the numbers were lies and that what she was mailing was dishonest, she didn’t feel so – that even though she knew that the days on market were not accurate, she was relying on data given to her.

Is this ethical? I feel it’s very unethical if not fraudulent. Anyone have any comments?

[gn]

Since it’s mostly about supply & demand (or must-sell suplly & demand), I would disregard the data on DOM.

The data on DOM is marginally helpful & not worth the trouble of reading it.

The key thing to watch for is the growth/reduction of must-sell supply.

[gn]

Since it’s mostly about supply & demand (or must-sell suplly & demand), I would disregard the data on DOM.

The data on DOM is marginally helpful & not worth the trouble of reading it.

The key thing to watch for is the growth/reduction of must-sell supply.

[SD Realtor]

Cyphire –

All I can comment on is how the Sandicor DOM works.

However before I do that, I just want to throw something out there… when people see a for sale by owner or a private party sale, how do you find out how long that home has been on the market? What mechanism is there in place to reliably determine that information? The answer is none. You take the sellers word correct? If you can prove the seller is lying then great.

Okay so Sandicor works like this. When you enter a listing, that listing takes on a new life in the MLS. What happened before, what happens after is not pertinent. This listing is yours and only yours. As long as that listing is active the MT field, market time will increment each day. There is an alternate field called AMT and this field adjusts for time off the market, (this would be a home in escrow or withdrawn). So say a home is active for 50 days and then is withdrawn for 10 days and falls out. MT would be 60 and AMT would be 50.

Now when a listing is cancelled a new listing is created. Yes everything starts over.

********

Is it ethical or unethical? That is up for debate. However ANY informed buyer will always ask their Realtor to perform a full search history on homes they are seriously interested in. To claim that buyers have no recourse on this subject to me is not an adequate argument. I don’t know about alot of things and I ask professionals about them whether it is taxes, legal issues, insurance issues, etc… Thus if there is a home you are seriously interested in you would ask your realtor to see the complete history of cancelleds, expireds, previous sales etc… Is it that hard to pick up the phone and do that?

Additionally why don’t the free services like Zip, Realtor.com and other agencies do this? Why are they not targetted for complaints as well?

You know I am not a shill for NAR and I hate when I have to defend “the system” because in general I don’t like the system. However, I just do not buy into the fact that there is a widespread victimization going on here. The information can more then readily be found.

SD Realtor

[SD Realtor]

Cyphire –

All I can comment on is how the Sandicor DOM works.

However before I do that, I just want to throw something out there… when people see a for sale by owner or a private party sale, how do you find out how long that home has been on the market? What mechanism is there in place to reliably determine that information? The answer is none. You take the sellers word correct? If you can prove the seller is lying then great.

Okay so Sandicor works like this. When you enter a listing, that listing takes on a new life in the MLS. What happened before, what happens after is not pertinent. This listing is yours and only yours. As long as that listing is active the MT field, market time will increment each day. There is an alternate field called AMT and this field adjusts for time off the market, (this would be a home in escrow or withdrawn). So say a home is active for 50 days and then is withdrawn for 10 days and falls out. MT would be 60 and AMT would be 50.

Now when a listing is cancelled a new listing is created. Yes everything starts over.

********

Is it ethical or unethical? That is up for debate. However ANY informed buyer will always ask their Realtor to perform a full search history on homes they are seriously interested in. To claim that buyers have no recourse on this subject to me is not an adequate argument. I don’t know about alot of things and I ask professionals about them whether it is taxes, legal issues, insurance issues, etc… Thus if there is a home you are seriously interested in you would ask your realtor to see the complete history of cancelleds, expireds, previous sales etc… Is it that hard to pick up the phone and do that?

Additionally why don’t the free services like Zip, Realtor.com and other agencies do this? Why are they not targetted for complaints as well?

You know I am not a shill for NAR and I hate when I have to defend “the system” because in general I don’t like the system. However, I just do not buy into the fact that there is a widespread victimization going on here. The information can more then readily be found.

SD Realtor

[Allan from Fallbrook]

SD Realtor: While I would agree with your sentiment that there is not widespread victimization going on, I would also point out a slight flaw in your argument. You are predicating your argument on the fact that people are, by and large, educated and professional like yourself. If someone is knowledgeable and knows the right questions to ask, it is a very different proposition from someone who is not and does not.

A quick read on the sub-prime mess shows a whole lot of people who never thought twice about asking some fairly basic (and commonsensical) questions about something as significant as their mortgage. There is a level of basic financial fundamentals missing in this equation.

If a realtor or broker was looking to pull the wool over someone’s eyes regarding D.O.M. metrics, I would think that, unless the person was someone knowledgeable about the process, it would be fairly easy to do.

You also have to remember (going along with your “ask professionals the questions” assertion) that most people have a certain level of deference to someone they perceive as a professional and take quite a bit of information at face value, as a result.

[Allan from Fallbrook]

SD Realtor: While I would agree with your sentiment that there is not widespread victimization going on, I would also point out a slight flaw in your argument. You are predicating your argument on the fact that people are, by and large, educated and professional like yourself. If someone is knowledgeable and knows the right questions to ask, it is a very different proposition from someone who is not and does not.

A quick read on the sub-prime mess shows a whole lot of people who never thought twice about asking some fairly basic (and commonsensical) questions about something as significant as their mortgage. There is a level of basic financial fundamentals missing in this equation.

If a realtor or broker was looking to pull the wool over someone’s eyes regarding D.O.M. metrics, I would think that, unless the person was someone knowledgeable about the process, it would be fairly easy to do.

You also have to remember (going along with your “ask professionals the questions” assertion) that most people have a certain level of deference to someone they perceive as a professional and take quite a bit of information at face value, as a result.

[PerryChase]

Since were’re talking about database technology, it seems to me that Sandicor isn’t in the business of providing accurate information. They are looking to slant data for the benefit of its membership.

The MLS could easily track sales and listing information using the parcel number and thus easily provide sales and listing history on a specific property since that parcel creation.

I would think that a buyer would be interested in the total sales history of a house. We need an open “carfax for houses” that would integrate sales and MLS information.

[PerryChase]

Since were’re talking about database technology, it seems to me that Sandicor isn’t in the business of providing accurate information. They are looking to slant data for the benefit of its membership.

The MLS could easily track sales and listing information using the parcel number and thus easily provide sales and listing history on a specific property since that parcel creation.

I would think that a buyer would be interested in the total sales history of a house. We need an open “carfax for houses” that would integrate sales and MLS information.

[NotCranky]

Hello Cy, welcome back to a gentler& kinder Piggingtons.

“Another positive sign in North San Diego County is the median days-on-market decreased to 43 days in May 2007 from 50 days in April 2007, and the average number of days on the market fell from 74 in April 2007 to 63 in May 2007.”

That in my opinion is misrepresentation of a material fact. Additionally, for the houses that don’t sell and cancell or expire, those days disappear instead being applied to the Average DOM. Correct me if I am wrong SDR?

[NotCranky]

Hello Cy, welcome back to a gentler& kinder Piggingtons.

“Another positive sign in North San Diego County is the median days-on-market decreased to 43 days in May 2007 from 50 days in April 2007, and the average number of days on the market fell from 74 in April 2007 to 63 in May 2007.”

That in my opinion is misrepresentation of a material fact. Additionally, for the houses that don’t sell and cancell or expire, those days disappear instead being applied to the Average DOM. Correct me if I am wrong SDR?

[SD Realtor]

Allan –

Granted your point is well made and I should assume a lower level of intelligence for the masses.

Rustico/Cyphire –

Yes the example you guys brought up is indeed what I would call a misrepresentation of the market. However I cannot 100% fault the MLS or the associations. The entire structure is rickety.

Yes the actual data should have had a disclaimer that reads,

“These statistics are compiled from only homes that have sold…are for this type of house… this particular zip code… etc….”

Rustico yes it is absolutely correct that the statistics over all are in fact gross misrepresentations about the state of the market. IMO the same is true about the median price, etc…

Thus let me retrace… in that sense the posting by Cyphire is correct. Yes it is abysmal what Realtors, what Dataquick, what most of the talking heads and economists say about the situation and how they use or shall I say misuse statistics. Equally bad is that boneheaded people, or buyers, slurp this stuff up and live and die by it. Agreed with you guys.

My point is that for many people it doesn’t take extraordinary intelligence to get as much information as they need in light of the situation.

SD Realtor

[SD Realtor]

Allan –

Granted your point is well made and I should assume a lower level of intelligence for the masses.

Rustico/Cyphire –

Yes the example you guys brought up is indeed what I would call a misrepresentation of the market. However I cannot 100% fault the MLS or the associations. The entire structure is rickety.

Yes the actual data should have had a disclaimer that reads,

“These statistics are compiled from only homes that have sold…are for this type of house… this particular zip code… etc….”

Rustico yes it is absolutely correct that the statistics over all are in fact gross misrepresentations about the state of the market. IMO the same is true about the median price, etc…

Thus let me retrace… in that sense the posting by Cyphire is correct. Yes it is abysmal what Realtors, what Dataquick, what most of the talking heads and economists say about the situation and how they use or shall I say misuse statistics. Equally bad is that boneheaded people, or buyers, slurp this stuff up and live and die by it. Agreed with you guys.

My point is that for many people it doesn’t take extraordinary intelligence to get as much information as they need in light of the situation.

SD Realtor

[sdrealtor]

I guess I just dont see this as a major issue. The actual numbers are pretty meaningless and I dont think people say “Omigosh, the days on market just went down so I better hurry up and buy!” MLS data will always be troublesome because it is self reported and that causes delays, inconsistencies and errors.

The problems today with the numbers existed last month and last year for that matter. The relevant point is that days on market went down and it probably did due to seasonality. here come’s a groundbreaking prediction and you heard it here first. Days on market will increase through the Fall.

[sdrealtor]

I guess I just dont see this as a major issue. The actual numbers are pretty meaningless and I dont think people say “Omigosh, the days on market just went down so I better hurry up and buy!” MLS data will always be troublesome because it is self reported and that causes delays, inconsistencies and errors.

The problems today with the numbers existed last month and last year for that matter. The relevant point is that days on market went down and it probably did due to seasonality. here come’s a groundbreaking prediction and you heard it here first. Days on market will increase through the Fall.

[Author]

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