If homes are selling so fast, why were Massachusetts single-family homes on the market an average 89 days in June 2014, according to the Massachusetts Association of Realtors?
On the one hand, homes are not selling that fast in all Massachusetts cities and towns. On the other hand, many communities within 30 to 45 minutes of Boston are seeing homes in certain price ranges go under agreement is less then a week, but the way the number of days on the market is tracked gives the impression homes are on the market much longer.
The way the multiple listing service (MLS) in the Boston area handles homes with accepted offers makes the data less valuable than one might expect. A seller can accept an offer a few days after listing the property; therefore, the property is not available, but the home may remain "on the market" (Contingent / CTG) until all the contingencies are cleared (a couple of weeks to a couple of months typically). At that point a listing agent likely would change the property status to Under Agreement (UAG).
For example, the seller of 123 Main Street Populartown, MA lists her home on a Thursday. Over the weekend there are a few showings and an open house. After a couple of days of negotiation, the seller accepts an offer on Tuesday, so the property has been on the market and available for six days. Technically, the home is still on the market, according to the local MLS. The property is "flagged" as contingent until all the contingencies in the offer have passed, i.e., home inspection, purchase and sale agreement, loan commitment date. When the listing agent changes the status to Under Agreement the property doesn't show up in most consumer searches any more and is officially off the market.
Another fact to keep in mind is that the data tracked "average" days on the market, so the overpriced homes that remain on the market for six months or more skew the average. Short sales may also remain on the market after an offer has been accepted for a long time while the parties wait for "third-party approval," i.e., the bank approval.
Certainly, looking at year-over-year numbers gives one a sense of the direction of the market and whether homes generally are selling faster or slower than the previous year, but the numbers don't accurately reflect how quickly properly priced homes may be selling.
The more expensive homes in any community likely are on the market longer, not just because there are fewer people who can afford those houses but because those sellers can typically hold out longer for the price they want. Those properties also tend to skew the numbers.
What is a Massachusetts home buyer to do? Watch the market to see how long it typically takes for a home in your preferred city or town in your price range to sell. Keep an eye on inventory too. The number of homes on the market will impact the speed at which homes sell, as well as prices.