What are “Cumulative Days on Market” (CDOM)?
Last month, when I first mentioned Cumulative Days on Market (CDOM), a client asked what it was all about. If you’re not familiar with the term, CDOM are the total number of days a property has been listed on the Ottawa Real Estate Board’s Multiple Listing Service® (MLS®) system.
Once a listing is made active and public on MLS® the clock starts and continues until the property is sold. Even if a listing is cancelled and re-listed at a different price or with a different brokerage, the CDOM count continues, unless the property is taken off the market for a longer period of time.
Why are the number of days on market important?
The longer a property stays on the market, the more prospective buyers and their agents wonder why it hasn’t sold. Buyers are also more likely to try and negotiate down the price or put forward a lowball offer when a property is slow to sell. The first couple of weeks a property is on the market are critical, simply because the listing is new to agents and buyers alike. An experienced REALTOR® will remind their sellers of the importance of not over-pricing a property and losing the attention, interest and respect of the very buyers they hope to attract.
The CDOM statistic is also one measure of how balanced the market is.
- A very short CDOM usually indicates a seller’s market, where sellers have increased confidence they will sell quickly and receive close to, or over, their asking price. Buyers may feel pressure to make decisions quickly and offer more competitively with fewer or no conditions.
- A very long CDOM usually points to a buyers market, where sellers may feel pressure to make more concessions to sell their property. Buyers may feel that there is more time to shop around and search for a better deal.
While the CDOM is an interesting and important statistic, it should not be considered in isolation. Other factors will also influence how long a listing stays on the market. Power of Sale properties, depending on their condition, can linger for a long time. Estate properties can as well, if incorrectly priced or if there are squabbling beneficiaries. And properties being sold only for lot value can stay on the market while potential buyers investigate zoning and determine if the future use of the lot is permitted by the town or municipality. The CDOM is just one part of the equation, but it’s worth paying attention to nonetheless.
If you have questions about real estate, Ottawa property prices or strategies to sell or buy, please call or message me. I am happy to help.