Key Takeaways:
Not unlike every other aspect of the real estate sector, selling a house may be deemed a success or failure based on how long it is listed for. Typically, the faster a home sells, the more likely the seller will realize their idea of success. However, properties that sit on the market for longer become a drain on the homeowner, which begs the question: how long does it take to sell a house? More importantly, how long should it take to sell a home, and what factors play the most important roles?
Average Days On The Market
“Average days on the market,” an indicator used to determine the average amount of time a listing will sit on the open market until closing, has declined in recent history. According to Realtor.com, homes spent an average of 66 days on the market as recently as December 2020. It is worth noting, however, that the important indicator has declined 16.0% year-over-year. Due to increasing demand and staggeringly low inventory levels, homes are selling faster and faster.
Moving forward, homes are expected to last an even shorter period of time on the market, thanks to the obstacles created by the Coronavirus. While it’s too soon to tell exactly how fast homes will sell in the coming year, there’s no denying that the pandemic compounded the inventory shortage. Over the course of 2020, builders couldn’t alleviate already low inventory levels because of quarantine guidelines and government-mandated “stay-at-home” orders. As a result, inventory shortages persist in the face of growing demand, which will most likely reduce the amount of time listings spend on the open market.
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Fastest Markets For Selling A House
The fastest markets for selling a house share a number of similarities, not the least of which include low inventory levels, a lot of demand, and desirable locations. Not only can the following markets exhibit these characteristics, but they have also become synonymous with the fastest markets for selling a house (according to Zillow):
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Columbus, OH: 8 Days
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Denver, CO: 9 Days
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Raleigh, NC: 10 Days
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Seattle, WA: 10 Days
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Boise City, ID: 11 Days
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Cincinnati, OH: 11 Days
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Grand Rapids, MI: 11.5 Days
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Ogden, UT: 12 Days
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Salt Lake City, UT: 12 Days
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Indianapolis, IN: 12 Days
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Boston, MA: 12 Days
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Colorado Springs, CO: 13 Days
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Dayton, OH: 13 Days
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Charlotte, NC: 13 Days
Slowest Markets For Selling A House
The slowest markets for selling a house tend to share a wider variety of indicators. Everything from government regulations to overpriced assets and poor locations can play a role in the length of closing times. That said, here’s a list of the slowest markets for selling a house:
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Little Rock, AR: 41 Days
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North Port-Sarasota-Bradenton, FL: 42 Days
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Miami-Fort Lauderdale, FL: 42 Days
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Allentown, PA: 43 Days
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El Paso, TX: 47 Days
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Fort Myers, FL: 50 Days
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Virginia Beach, VA: 51 Days
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New York, NY: 51 Days
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McAllen, TX: 58 Days
What Factors Affect A Home Selling Timeline?
There are countless factors that must be accounted for when trying to determine how long it takes to sell a home. Everything, from how the home is presented to buyers to the marketing strategy implemented by the seller, plays an instrumental role in the home selling duration. Nonetheless, there are some factors which appear to be more common. Here’s a list of some of the most impactful factors that will determine how long it takes a home to sell:
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Competition
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Condition
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Location
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Seasonality
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Finances
To be clear, these are not the only factors that affect a home selling timeline. The price of the home and the condition of the market are also key factors to consider, which we go into more detail here.
Competition
Competition is the single greatest factor in determining how long a listing will last on the open market. The more competition a market has, the more likely its homes will sell at an expedited pace. Conversely, lower levels of competition can easily increase the amount of time real estate assets remain listed.
When demand outweighs supply, competition has a way of forcing buyers to act faster. In fact, buyers aren’t even granted the luxury of taking their time in markets where competition is fierce. High levels of competition require buyers to act fast, which can simultaneously increase offers and lower the amount of time it takes to sell a home. Those who hesitate in even the slightest way run the risk of losing out on a home altogether. Therefore, competition fuels fast-paced activity, which reduces the amount of time it takes to sell a home.
Condition Of The House
Traditional home sales typically witness houses in pristine condition sell for more money and in shorter periods of time. Not surprisingly, most buyers are after the best homes their money can buy; after all, better “products” attract more consumers. The more interest a home receives, the better chance it will sell quickly.
Having said that, homes don’t need to be in perfect condition to sell fast. In fact, homes in poor condition can oftentimes sell faster than their pristine counterparts. Unkempt homes attract entirely different buyers who are no less excited to buy quickly. In particular, Rehabbers and real estate investors will target poorly cared-for homes and attempt to buy them quickly (before other investors). While a home’s condition will impact the amount of time it spends on the market, each situation must be accounted for based on its own merits.
Location
The real estate industry’s primary tenant is also a contributing factor to the amount of time it takes to sell a home: location, location, location. Where a home is located will determine the amount of time it is expected to last on the market. Once again, however, there’s a direct correlation between location, competition, and “days on market.” If for nothing else, a property’s location will either contribute or detract from demand. The more popular the location is, the more demand there will be. Consequently, less-desirable locations won’t concede with as much demand as their more attractive counterparts. As a result, location leads to demand, ultimately determining how long a home will remain listed.
Seasonality
Traditionally, seasonality has played a major role in the amount of time it takes to sell a home. Nonetheless, seasonality and competition are essentially the same. Busy buying seasons (like spring and summer) are a catalyst for demand, which simultaneously drives up competition and the speed at which prospective buyers are willing to act. You see, peak buying season starts in the latter part of spring when schools are out and the weather permits. Ultimately, more people can participate in the market, which results in demand lowering the average number of days a home will remain listed.
Consequently, fall typically witnesses buying activity drop off well into winter. The changing seasons means inclement weather and busier schedules hinder the ability for buyers to make a purchase. With fewer people looking to make purchases, demand and competition are inherently suppressed, resulting in homes remaining listed for longer.
Buyer’s Finances
The buyer’s access to capital plays a big role in the amount of time it takes to close a real estate deal. Buyers who have been pre-approved and pre-qualified for a loan, for example, should be able to buy a home as soon as the underwriting of the loan is completed. Even faster than those who need to apply for a loan, all-cash buyers can complete a transaction almost immediately. On the other hand, buyers who aren’t qualified to receive the loan they need to acquire a particular property, or those with questionable financials, could either delay the closing process or terminate it altogether.
How To Sell Your House Faster
While sellers may not be able to control all of the factors listed above, there are some steps they can take to speed up the process. Here’s a list of things owners can do to help them sell their homes faster:
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Hire The Right Agent: A good agent is worth their weight in gold, and some of the best agents in the country have become synonymous with seamless, quick closing schedules. That said, don’t hire just any agent; hire the right agent. When enlisting an agent’s services, pay special considerations to their closing track record and how quickly they can complete deals.
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Refrain From Conducting Major Renovations: There is no problem conducting a few renovations before selling a home, but days before the sale is no time to undergo a major project. For one, renovations open up owners to the risk of complications that take weeks or months to fix. Any unexpected circumstances could lengthen the time it takes to sell a home.
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Stage The Home: Staged homes have proven that they cannot only increase offer prices but also lessen the amount of time it takes to find a buyer. As a result, sellers should spend a little money to stage their homes accordingly. Doing so may take some time to set up, but the finished product usually helps sell homes much faster.
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Get A Pre-Listing Inspection: The sooner a seller can get their home inspected, the sooner they will be able to tackle any unforeseen issues that could delay a deal. Getting the home inspected before listing could save a lot of time when working with buyers later.
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Price The Home Right As perhaps the best thing a homeowner can do to sell their home fast, pricing the property slightly under the market value will help draw more attention. The added attention will fabricate more demand and competition, which could help the home sell faster and for more money.
Summary
Selling a house is a fluid process; the process pits homeowners’ emotions against objective indicators. As a result, no two sales are the same, which begs the question. So how long does it take to sell a house? Not surprisingly, there’s no universal answer. How long it takes to sell a home is contingent on many of the above factors, and many that weren’t even touched on. That said, there are steps owners can take to speed up the process. With the information this article touches on, homeowners should decrease the amount of time their homes spend on the market and perhaps even increase their sales prices.
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