This regularly-scheduled sponsored Q&A column is written by Adam Gallegos of Arlington-based real estate firm Arbour Realty, voted one of Arlington Magazine’s Best Realtors of 2013. Please submit follow-up questions in the comments section or via email.
Q. What’s going on with these “Coming Soon” signs? In my neighborhood, there’s one that has been saying that for more than a month, another that said that for about two weeks before saying “For Sale,” and another that was “Under Contract” in less than a week without going to “For Sale.” Is this some new marketing gambit? I assume you don’t use my name or email if you answer on ARLnow?
I want to assure you and anyone else that sends me a question… I will not use your name or any other identifying information in my articles.
In order to explain the “coming soon” phenomena, I need to discuss days on market (DOM). Once your listing goes live in the multiple listing service (MLS), it starts collecting DOM. As this number increases, it decreases the perceived value of the home. Potential buyers start to assume it is overpriced and/or something is wrong with it. Instead of being a hot new property that buyers will clamor and compete for, it starts to attract low-ball offers. Leverage in the negotiation essentially shifts from the seller to the buyer.
By marketing a home as coming soon, the agent can generate interest in the property and maybe even a contract, prior to gaining a single DOM in the MLS. Agents generate interest with a coming soon sign in the front yard and grassroots marketing through their website and personal network.
This strategy is particularly prevalent this time of year. A homeowner may have interest in selling as soon as possible, but does not want to risk exposing the home to more days on market during the slower real estate season. There is a house in my neighborhood that has been coming soon since November. My expectation is that it will go active some time this month as real estate activity kicks into a higher gear.
The views and opinions expressed in the column are those of the author and do not necessarily reflect the views of ARLnow.com.