The Average Time to Sell a House
If you’re a seller, letting your house sit on the market for too long will lower your chances of getting a reasonable price for it. That’s why it’s in your best interest to sell as quickly as possible.
In this post, we’ll take a look at the average time to sell a house, the pitfalls you need to watch out for, and ways to speed up the process.
How to Calculate the Average Days on Market
One of the critical metrics buyers look at is the Days on Market, or DOM. It represents the length of time it takes to sell a house. Or, defined another way, it’s the number of days a home spends on a multiple listing service (MLS) until it becomes pending, meaning an offer has been made for that property.
Days on Market (DOM) is an essential factor for sellers because the longer a house is on the market, the less likely that they will get their asking price. If you’re wondering why that’s the case, you can partly blame the buyers for that.
If houses stay on the market for too long, buyers think that the seller is having a hard time selling the property and is becoming desperate to sell it off. Or, they might be asking more than what the house is actually worth. Of course, these are the conclusions that may or may not be true. But it nevertheless affects your ability to sell your home.
Now, how do you know if your property’s DOM is too long for your current area? You can use another metric called Average Days on Market as a benchmark. Simply put, this is the average time a house is on the market for a given area. If your property’s DOM exceeds the average DOM, then your home is already “too long” in the market.
To calculate average days on market, you need to find all the listings in your area for the past 1 – 6 months. You then determine their DOM by figuring out when these listings entered pending status, then counting backward until the first day they got listed. The number of days is the DOM.
Once you have all the DOM of all the listings, then it’s a straightforward calculation. Simply add up all the DOM and divide the result by the total number of listings, and you get your average time for all houses on the market.
Key Selling Milestones and Length to Achieve
The average time it takes to sell a home, from deciding to sell your house to handing the keys to the new owner, is generally around 6-9 months. This includes the time you spend preparing your house for sale: cleaning, repainting, staging, and repairing. Then there’s also the long task of selecting a real estate agent.
The prep work can easily add another 3-6 months to your timeframe, depending on the size of your house. So overall, you’re looking at an average of 6-12 months for the whole process.
Let’s focus on each portion. That period is broken down into distinct milestones, each with its own time frame.
After you have evaluated the market, decided to sell your house, selected a real estate agent and finished your pipework, the next milestone is listing your property. After you have prepared your house for selling, you then post it on an MLS or possibly on another real estate platform. It sits there until an interested buyer comes in and makes a formal offer to buy your property. The average time this takes is between 1 – 2 months.
Once you’ve found an interested buyer, they will submit a formal offer to buy your property. You’re then given up to 72 hours to accept or reject their offer. The length of time varies from state to state.
After you have accepted their offer, the buyer then needs to conduct a home inspection on your property. They will be given up to 10 days to complete this phase. The examination itself takes less than a day, depending on the size of the property, plus a day or two for the formal report to come out.
The buyer can then submit a counteroffer, based on the findings of the house inspection. Maybe they saw a piece of nail sticking out of the floorboards, or a small chip in the windowsill. Whatever it is, the buyer will usually ask for a lower price, or sometimes ask that repairs/renovations be made. This process goes into a back and forth price negotiation that takes anywhere from 24 to 48 hours to resolve.
Finally, once you and the buyer have agreed on the price, the deal then enters its final phase: the closing. This part takes roughly 30 days, giving both the buyer and seller enough time to fulfill the requirements. Usually, both parties will get the services of a closing attorney and an escrow service to make sure everything goes smoothly.
Factors That Affect the Time on the Market
How long does it take to sell a house? The short answer is: it depends on several factors. But although the average time to sell a house varies from market to market, you can always expect it to be a time-consuming process.
If you’re looking to quicken the pace or just want to set expectations, here are some factors affecting days on market:
Asking Price
The asking price has the most significant impact on how long your property spends on the market. It’s also one of the few factors that you can directly control.
The price of your property is directly proportional to how fast and easy it is to sell. Generally, the lower the asking price, the quicker it is to sell, and the less time it spends on the market. Expensive houses are less accessible to most buyers, and you’ll generally have a harder time selling it.
Of course, lowering the price isn’t always ideal. Less price means lower profits for you. An excessively low price even has a negative impression on buyers—they can get the idea that there’s something wrong with the home.
Location
Next to pricing, location is the next significant factor when it comes to selling real estate. Generally speaking, a more desirable location—one near schools or in affluent neighborhoods—will make a property very attractive to buyers. Therefore, it will spend less time idling on the market.
The average time to sell a house by zip code is a factor. Some cities and zip codes are statistically better housing markets than others and can sell homes faster overall.
Here’s an example of how long it takes to sell a house by zip code or city from when it’s listed. A property in a big city like San Francisco can sell in 49 days on average. Contrast this to a home in Naples, Florida, which took an average of 148 days—more than three times as long!
Home Condition
The general appearance and look of your property has a big hand in determining how easy it is to sell. Houses that have a gorgeous patio, a well-manicured lawn, or a bright white fence are more attractive to buyers. There’s a bigger chance that you’ll get quick offers for it.
One easy and cheap way to improve the condition of your house (and therefore make it more eligible) is to declutter it. Buyers love it when they can imagine themselves living in your house, and they can’t do that if it’s stuffed full of furniture and personal nicknacks. Get rid of bulky furniture and clear the walls of your family portraits..
The Current Market Climate
The market climate tells you how “hot” the housing market is in a given area. You can either be in a “cold” buyer’s market or a “warm” seller’s market and, between the two, you want to be in the latter.
A seller’s market will have more buyers than sellers. That means more eyeballs on your property, higher chances of getting offers, and a faster selling cycle as a result. You may even get into a bidding war where multiple buyers make offers on your house, which is a REALLY great place to be in as a seller!
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