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If you need to sell your home pronto, now is a great time. The recent housing market has been hot and competitive due to an extreme lack of inventory. For a seller in a hurry, the shortage of homes means you can anticipate fewer days on market (DOM).
Just how fast can you sell your home? During a seller’s market like the one, we had in the summer of 2021, a top real estate agent could help you find a buyer for your home in as few as 75 days from listing to closing. If you need to move even more swiftly than that, selling to an online direct buyer through a platform like HomeLight’s Simple Sale could take as little as 10 days.
In this article, we explain the factors that affect the momentum of a home sale with the help of Danielle Hernandez, a top real estate agent and team member with the Oldham Group in the California Bay Area.
How it might take 12-75 days to sell your home
A traditional home sale in which a seller lists with an agent and a buyer finances with a mortgage takes approximately 18-30 days to go under contract, plus an additional 30-45 days to closing. This means, using the conventional process, you can generally sell your home in as little as 48-75 days.
If you need to move faster than that, consider selling for cash to a direct buyer. The Simple Sale process frees you of the hassle of staging your home and jumping through hoops for the buyer’s lender. You simply request a cash offer from fully vetted cash buyers. It generally takes a couple of days to come to an agreement with a buyer and as few as 10 days to close.
That said, the number of days your home is on market depends on several factors, such as:
- The location of your home
- Market conditions at the time you sell
- The time of year you sell
- Condition of your home
- Listing price
- Buyer’s financing method
- Your selling method
What do days on market mean?
The days a home is on market, also called time on the market, means the length of time between the day the home is listed on the local multiple listing services (MLS) and the day the seller accepts an offer and it goes under contract. Days on market don’t include the length of time between the date the seller accepts the offer and the home sale closes.
Average days on market are calculated by adding up the days on the market of each listing and dividing by the number of homes listed. As of September 2021, the average days on market were as follows:
How long does it take to sell a home
|Direct Buyer (Simple Sale)||Traditional Sale|
|Average Days in 2021||Average Days in 2021|
|Days on Market||2 days||18 days|
|Closing||10 day||46 days|
|Total||12 days||64 days|
9 factors that affect the timeline of a home sale
Average days on market varies from location to location, depending on how many properties are for sale in comparison to how many home buyers are moving into that area. According to Global Property Guide, it took approximately 90 DOM to sell a Texas property in 2020.
According to Forbes, in 2021 the hottest seller’s markets, with homes selling in less than two weeks, were:
- Oakland, California
- Rochester, New York
- Austin, Texas
- San Jose, California
- San Francisco, California
- Seattle, Washington
- Buffalo, New York
- Grand Rapids, Michigan
- Eugene, Oregon
- Denver, Colorado
2. Current market conditions
During a hot market, when there are fewer homes for sale than there are buyers, homes get snatched up faster. In 2020, the National Association of Realtors (NAR) estimated an average of 25 DOM for home sales across the U.S. During the shortage of available homes in 2021, DOM decreased from 21 days in January to 17 days in August for an average of 18 DOM in 2021. The average DOM in 2019 was 30 days.
3. Time of year you list your home
While most homes sell fastest in the spring, the best time of year to sell your home depends on your location. For example, the best time to sell your Rochester, Minnesota home is in April and May when med students are looking for housing. However, the best time to sell your Phoenix home is in the fall when temperatures have started to drop and snowbirds have begun migrating south. If you’re wondering which months are the best to sell your home fast, we have a handy little calculator for that.
4. Condition of your home
Move-in ready turn-key homes tend to sell faster than fixer-uppers, or as Hernandez calls them, fixers. However, an older house that needs some repair work isn’t as much of a deterrent to buyers during an inventory shortage. Keep in mind though, that a home that needs major repairs may slow or derail a sale to traditional buyers who are financing with a mortgage. Most buyers get an inspection, which may initiate repairs or re-negotiations. Lenders also require an appraisal. If an older, decrepit home is valued below the purchase price, the closing date may get pushed back while the seller and buyer try to save the deal.
5. Listing price
If your home is overpriced, it’s going to be hard to move without serious negotiations on your part. If you want to price your home to sell fast, keep it within the price of comparable homes in your area (comps). If you price your home emotionally, to make a profit in a hot market, or to recover the full cost of upgrades, you’ll slow or even stop any potential sales. To help you set the best price on your home, a top real estate agent will provide you with comps and a pricing recommendation.
6. Days on market
It’s true. The longer your home sits on the market directly contributes to the likelihood that your home will continue to sit on the market. Buyers are wary to look at or consider a home that has been listed for a longer than average time. For this reason, most real estate agents’ listing agreements are 90 days or less. If a home doesn’t sell at this time, one plan of attack is usually for the seller to cancel the listing and relist with another agent. But, relisting can also increase the amount of time it takes to sell. In some states, the seller must wait 60 days to relist if the plan is to “reset” the days on market. Also, keep in mind that a canceled listing is available to a savvy buyer who looks up the listing address.
7. Your selling method
How you sell your home also affects how fast it sells. One of the fastest methods would be to skip listing and marketing the home and instead sell directly to a cash buyer. If you don’t want to sell your home this way, listing your home with an experienced real estate agent is likely the next fastest way to do it.
An agent will take care of all the paperwork, listings, and marketing of your home to buyers. Hernandez says, “An agent moves with lightning speed to have your home on the market in no time.” After your home is listed, it takes, on average, 64 days from listing to closing in a hot market.
Selling by owner (FSBO) is a slower process because most FSBO properties aren’t listed in the local multiple listing services (MLS) for buyers to see or marketed by an agent who knows the area and has access to potential buyers. Because only 6% of FSBO sellers list their homes on the MLS, it’s impossible to calculate the average DOM before FSBO sellers enter into an agreement.
If you sell by owner, plan on an extended timeline during which you’ll market your home on social media, plan showings around your schedule, and consult with a real estate attorney (which may be required by state law).
8. Buyer’s financing method
It’s going to take more time to sell to a buyer who finances with a mortgage. In fact, the mortgage process is the most common culprit for slowing down the sale. A buyer using a mortgage will most likely include the following contingencies (all of which have deadlines):
- Inspection contingency (note: this one is optional and buyers can choose to waive it)
- Appraisal contingency
- Home sale contingency
- Mortgage contingency
- Clear title contingency (note: all home sales depend on this contingency)
Mortgage companies require an appraisal, which must be scheduled, performed, and waited on for a report, and may result in further negotiations.
The Inspection and negotiations can take up to 18 days
The purchase agreement generally has an inspection period (usually 10 days) during which the home must be inspected for defects, the findings reported, and repair requests submitted. The seller usually has five days to reply or negotiate repairs (some of which may be required by state law), and the buyer has three days to respond to the reply. Whatever repairs the seller agrees to do must be made before the closing.
The appraisal can take up to a week (or longer)
An appraisal contingency means that the sale will proceed as planned only if the appraised home value is equal to or greater than the purchase price. An appraiser determines the home’s value based on the age, size, condition, and features of the home and also by recent sales of similar homes in your area.
Banks generally jump on scheduling the appraisal and have it back within two to seven days. Unfortunately, during a hot market, when houses are moving faster than a sneeze through a screen door, appraisers are having difficulty keeping up with the demand. And there’s not a lot a seller can do about a slow appraisal process. As long as the buyer has shown good faith in getting an appraisal scheduled, it’s difficult (and costly) for the seller to back out of the deal. And doing so will only further delay the sale process and mean waiting on another overworked appraiser.
Another way an appraisal can affect the timeline of the home sale is if it comes in below the purchase price. When this happens, the seller and buyer will most likely need more time to save the deal, which can include such tactics as challenging the appraisal, the buyer seeking out a new lender, the buyer scraping together cash to make up the difference, renegotiating the purchase price, or a combination of these. If no solution can be reached, the buyer can walk away with their earnest money intact.
Home sale contingency can be up to 60 days
A home sale contingency means that the lender agrees to finance the sale as long as (and after) the buyer sells their current home. This contingency period is usually 30-60 days. If the buyer doesn’t sell the home at this time, the seller must decide whether to extend the additional time to the buyer or walk away from the deal.
A title search can take up to 14 days
All home loans (and all legal home sales, for that matter) are dependent on a clear title. A title company or attorney performs a title search to verify that the home belongs to the seller and there are no judgments, bankruptcies, or liens against the home. A title search can take anywhere from a few hours to 14 days.
Underwriter review can take 30-60 days
A mortgage contingency means that the buyer must obtain the necessary financing for the purchase. The bank’s underwriter can take up to 60 days to give their final blessing (called “clear to close”) on the loan. The closing must happen within three days of the underwriter’s clear to close. The underwriter can extend the closing date to confirm the paperwork.
Even a pre-approved buyer can get turned down by the bank’s underwriter before closing. Some of the reasons why a buyer might lose the financing include overextended credit, insufficient income, loss or change of a job, or unexplained cash deposit (that the lender suspects the buyer will have to pay back).
The buyer might be able to work out the issue with their lender or find another lender. It’s up to the seller to decide whether to walk away from the deal or extend the contract in the hope that the buyer can come up with the financing.
When you finally reach the big closing day, you may wonder how long it will take to sign the house over. Traditional, in-office signings generally take 1.5-2 hours to dot all the i’s and cross all the t’s. However, actually attending the closing is no longer the norm. Many sellers (and buyers) sign all the paperwork digitally. In some areas, the paperwork may be couriered to you for signature.
How to speed up your home sale
While most delays are caused by the buyer’s lender, if you need to move ASAP, you can take a few steps to expedite the sale, consider:
Clearing the title
Before you list, clear the title of any judgments and pay off any debt against the lein.
Getting a pre-inspection
Sellers who need to move fast can pay for a pre-inspection to speed up the process. A pre-inspection gives the seller more time to repair any issues with the structure, wiring, plumbing, or roof.
Preparing the home
Before you even contact a real estate agent, you need to clean, organize and make minor repairs. You’ll want to pay off any liens or settle any claims against the home. It takes time to prepare your home for sale. This is a great time to pack. Declutter, and depersonalize (remove family photos, etc). Generally, it takes a homeowner six months to prepare their home for sale, but homeowners who need to sell fast can expedite the process by following this plan.
Hiring a top real estate agent
Once your home is ready to sell, a real estate agent moves with lightning speed to get it on the market in no time. This step includes 2-3 hours to fill out the listing agreement (the contract you make with the agent to sell the property). Your agent may make staging recommendations or hire a stager to decorate your home. Then your agent will take pictures, prepare marketing materials, post a yard sign, and list your home in the local MLS.
Your agent will handle the paperwork, schedule showings, negotiate on your behalf, and manage the closing details. Find a top agent in your area with HomeLight’s Agent Finder tool.
Ensuring prospective buyers are fully vetted
A top real estate agent will make sure buyers have the necessary financing to prevent closing delays. If you’re selling FSBO, be sure to verify the buyer’s preapproval letter.
How long it takes to show your home depends on how accommodating you are. Live in your home like you’re a guest, keeping it spotless and ready for showings. We know, it’s a stressful time, but it’ll be over soon! The less advance notice you need to prepare for showings, the faster it’ll sell. As well, you need to accommodate requests and questions by responding as soon as possible. Have repair receipts, property taxes, and utility bills on hand to meet those requests before they’re made.
Making decisions and communicating clearly
Negotiations can be stressful and time-consuming. Discuss your options with your real estate agent and be decisive and clear to reduce the time spent negotiating and alleviate misunderstandings. A simple phone call can reduce the back and forth of texting or emailing which takes up unnecessary time.
Selling to a cash buyer
If you need a swift and sure home sale, consider selling to a cash buyer who isn’t tied to a lender. You can save yourself two months’ worth of hassle and uncertainty. HomeLight’s Simple Sale provides sellers with fast, competitive offers from fully vetted buyers in as few as 48 hours, with the ability to close in as little as 10 days (or whenever you’re ready to move). Read this overview to learn more about selling to a cash buyer.
Header Image Source: (Alberto Castillo Q. / Unsplash)