How long does it take to sell a house?
Selling your house is a multi-step process that can take weeks, if not months, from the prepping and staging to showings and all that closing paperwork. But the biggest time drain is one issue — how long your house lingers on the market.
In this post, we’ll cover some of the most relevant factors that have an influence on the time it takes to sell a house:
The timing is critical because it’s usually the most stressful. You might be concerned about your asking price, fretful about your agent’s open houses and showings, angry about negative buyer feedback, agonized while you’re waiting for offers or worried about when, exactly, you’ll have to vacate your home. Pressure from family members, shopping for a replacement home, packing to move and maybe starting a new job can make the situation even more stressful.
How quickly will your home sell? The answer depends on how well your home is priced, where it’s located, what condition it’s in and how strong your local market is, among other factors. Here are five factors you should consider.
1. Asking price
A home’s asking price is the most important factor in terms of time on the market. Homes that are attractively priced relative to their market value attract offers even if they’re not in great shape or in a prime location. Homes that are overpriced take longer to sell even if they’re in a great location and in new or like-new condition.
If your home is overpriced, you’ll have few options to sell it. You can lower your asking price, accept an offer that’s lower than what you’re asking, materially improve your home’s condition or take your home off the market and wait for a more auspicious time to sell it.
The preeminence of price means you need to set your asking price to reflect your preference for a quick sale or a slow one. To shorten your time frame, consider setting your asking price on the low side of your home’s value. If you’re not in a hurry to sell and don’t mind the inconvenience of having your home on the market, consider setting a slightly higher asking price so you can recoup more equity. Some agents won’t market an overpriced home. Others will take a chance and hope you’ll lower your expectations before your listing expires.
2. Home condition
Your home’s age and condition generally aren’t as important as your asking price in how quickly your home will sell. Sometimes, an old fixer-upper with a bargain price can sell faster than a new, prime-condition home that’s overpriced. However, in some instances, say in a hot market with many modernized or revamped homes, an older DIY house might linger looking for a buyer.
One aspect that might make a difference is whether the home is staged to appeal to likely buyers. A study titled “2017 Profile of Home Staging” by the National Association of Realtors found that 38% of sellers’ agents said they staged all their sellers’ homes before they were put on the market, and 39% said staging shortened the time it took to sell a home. Rooms that were most often staged were the living room, kitchen, master bedroom, and dining room.
3. Lot and location
Obviously location is a key factor in a home’s market value and how long it takes to sell. Buyers aren’t all alike, but generally speaking, certain factors tend to make a home’s location more or less valuable.
4. Market conditions
Real estate markets are notoriously cyclical. Selling a home in a hot market can be a very different experience from selling in a cold market.
Hot markets are characterized by high demand, low supply (also known as inventory), rising prices, multiple offers, bidding wars, waived contingencies and fast sales. Hot markets are also called seller’s markets because their conditions favor sellers in negotiations with buyers.
Cold markets are characterized by low demand, high inventory, falling prices, price reductions, seller concessions, slow sales, short sales and bank foreclosures. Cold markets are also called buyer’s markets because their conditions give buyers the upper hand over sellers.
Markets can shift quickly. If a market is in transition, selling a home can be more challenging. Generally speaking, if your local market is rising, you may be able to set your asking price slightly higher than the recent sales prices of comparable properties.
Conversely, if a market is declining, you may need to be more conservative in your expectations. The worst case is to overprice your home in a falling market and get sucked into a whirlpool of price reductions as you follow the market down. Odds are, you’ll end up selling your home for less than it was worth when you set your original asking price.
A key metric that indicates whether a market is hot, cold or in-between is the average number of days that homes are actively on the market before the seller accepts an offer. The longer a days-on-the-market (DOM) tracker is, the slower or colder that market is.
DOM can vary dramatically from one market to another. In August 2018, homes in the U.S. were on the market for a median of 61 days before they were sold, according to Realtor.com. Local data for that month reveal relatively slower sales in some cities and relatively faster sales in others.
Data Source: Realtor.com residential listings database for August 2018
Average DOM can also vary by market segment. For example, entry-level homes might be selling faster or slower than trade-up or luxury homes.
5. Seasonal patterns
Many real estate markets also feel the impact of seasonal cycles. In some markets, more homes sell in springtime and fewer in winter because more people want to move during the summer when school is out of session, rather than during the winter when short days, classroom cliques, and snowfall make moving more of a chore. In other markets, blazing summers and mild winters can create different seasonal patterns of home sales. The best time to sell a home in Florida is not the same as the best time to sell a home in Minnesota.
If you live in a highly seasonal market, you might be able to sell your home faster during the prime home-selling season, no matter the school calendar, when more buyers are ready to make an offer. If your market doesn’t have much seasonality, timing your home sale may not make such a difference.
Ultimately, the time it takes to sell a house depends on a complex interplay of price, market dynamics and neighborhood and property characteristics. How long it will take to sell your house ultimately depends on your timeline and the decisions you make about your home and how you sell it.
September 18, 2018 — Written by Marcie Geffner