We received a couple of questions this week surrounding “Days on Market” and price changes in the MLS. (Multiple Listing Service)
What is the AZ real estate law regarding resetting the number of days on market (what is required)?
There is no state statute defining how “days on market” (DOM) is set, counted, or reset. These factors are based on the MLS rules and regulations, not state law. That said, here’s how it works (note, this applies only to the Arizona Regional MLS (ARMLS) — other MLS’s have different rules and regs).
ARMLS uses two number to show DOM. “Agent DOM” (ADOM) and “Cumulative DOM” (CDOM). It’s easiest to explain with an example:
If you list your home with Jay and Francy Thompson, then the ADOM and the CDOM clock begins ticking when we enter the listing into the MLS. Assuming you don’t fire us (and you wouldn’t of course), the ADOM and CDOM will be the same number, with the DOM clock stopping on the day of close.
Now, let’s assume that you fire Jay and Francy (that’s a real stretch, but it’s theoretically possible) and enlist the services of another agent. At that point, the CDOM clock continues to click as if nothing changed. It is after all, tracking cumulative days on market. However, the Agent DOM clock will reset to 0 and start counting again.
So how do you reset the CDOM clock to zero? The only way you can do it in ARMLS (legally) is by taking your house off the market for 90 days. The system was designed this way to prevent practices like changing price by a dollar, moving the home from a listed to a pending and back to a listed state — and similar such practices used just to reset the DOM clock to zero and give the impression your home was just listed. (There is a way to reset the CDOM clock to zero within the 90 day period, but I’m not putting that in print, and I won’t do it for a client as I don’t think it’s an ethical practice. It’s a loophole ARMLS needs to close.)
Can agents see on the MLS how many price changes a house has had? If so, can the listing agent reset that so agents can’t see how desperate you are in selling your house?
There is a report that can be run that can access MLS listing changes. Many agents probably don’t even know it exists. I didn’t until VERY recently. (Thanks Greg!) Once the change is made and hits the archive, I don’t believe there is a way to remove it. And if there was, doing so would certainly cross the ethics line. The “desperation perception” is one (big) reason it’s critical to list a home at the right price to begin with. Too many agents will take any listing, let the client dictate the price, and just hope to be able to reduce it later. That’s not a good plan. Price it right in the first place and you won’t have to worry about it.
Personally, I think DOM is an overrated metric that causes way too much heartburn for buyers, sellers and agents. There are multitudes of reasons for long DOM, and too many unethical agents manipulate it. Price, condition and location are what matter in any real estate transaction. Long DOM may simply mean the home was listed at too high a price. That doesn’t mean there is anything wrong with it, other than unrealistic seller expectations (which may make it difficult to get the house at the proper price). But DOM is probably whole ‘nuther post.
[tags]ARMLS, DOM, days on market[/tags]