Categories: For Buyers
One would think that the number of days a property has been on the market is an important thing for a buyer to know. Even in a hot market.
One would also think that whether a property for sale has had a price reduction might also be a relevant fact. I certainly think so.
Our MLS system allows agents to make a price change. If a price change is entered into the MLS, you can see that the price was changed and you can look at the history to see what the old price was before the change. You can also see how many days something has been listed by looking at the “DOM” or ‘days on market’. The clock starts ticking when the property is listed initially and keeps going through however many price changes it takes to get it sold.
A condo that’s had 3 price reductions and has been on the market for 107 days does not seem as enticing as a new listing with no price reductions that’s only been on the market a day, right? Seems like important stuff to know when your shopping for a condo in Hoboken. I would ask my agent those questions if I were a buyer.
Yet there is a new game in town. The game is played by the same few agents every time they want to do a “price change”. But these agents don’t enter a price change. They’ve figured out how to game the system and say ‘the seller wanted me to do it that way’.
Rather than reduce the price, the agent has the seller sign a withdrawal form so the listing comes off the MLS. The agent then immediately re-lists the property at a new, lower price. This way you, the buyer, (and maybe other agents) are hopefully fooled into thinking that:
1.) It is a brand new listing and shows up as such in the daily “hot sheet” of new listings and at the top of internet sites that list by newness;
2.) It hasn’t been sitting on the market unsold for any period of time at a higher price; and
3.) There have been no price reductions.
When I asked the powers-that-be at the Hudson MLS about this I was told “it does not violate any rules”. It may not violate any rules but don’t you think it hurts you – the consumer – when information about a market as vital to the economy as the local real estate market is distorted? Or maybe all agents will start to play this new game and the “price change” will become a thing of the past while “DOM” becomes meaningless.
Caveat Emptor lives on.