Is Alamo leaning toward a buyer’s market or a seller’s market right now? If you have been scanning listings, you have probably seen terms like DOM and absorption rate, but it is not always clear what they mean for your decision. You deserve a simple way to read these numbers so you can price, negotiate, and time your move with confidence. In this guide, you will learn what these metrics mean, how they behave in Alamo, and how to use them to your advantage. Let’s dive in.
Key terms: DOM, absorption, MOI
Days on Market (DOM)
- What it means: The number of days from when a home first goes active in the MLS to when it goes pending or sold.
- Important nuance: Some MLS systems show “cumulative DOM,” which continues counting through price changes and relists. Others reset DOM if a listing is withdrawn and relisted, which can make a home look newer than it is. Always ask if DOM is cumulative.
- How to use it: Look at median DOM for the specific price band and property type you care about.
Absorption rate
- What it means: The share of current inventory that is selling each month.
- Simple formula: absorption rate = monthly closed sales ÷ active listings.
- How to use it: Higher absorption means faster turnover and stronger demand.
Months of Inventory (MOI)
- What it means: How long it would take to sell all current active listings at the recent sales pace.
- Simple formula: MOI = active listings ÷ monthly closed sales. It is the inverse of absorption rate.
- Rules of thumb: Seller’s market is often under about 3 months of inventory. Balanced is around 3 to 6 months. Buyer’s market is over about 6 months. In upper price ranges, timing can be longer even when demand is healthy.
How these metrics behave in Alamo
Small sample sizes can swing the numbers. Alamo has fewer monthly sales than larger cities. A single high-end sale can shift the median DOM or MOI. You get a more reliable picture by comparing the last 30 to 90 days with a 12‑month trend.
Luxury pricing stretches timelines. Alamo skews higher in price. Homes at the upper end tend to show longer DOM because the buyer pool is smaller and financing and appraisal steps can take longer. That can be normal even when the market is competitive.
Seasonality matters. Activity usually cools in late fall and winter and strengthens in spring and early summer. A 40-day DOM in January tells a different story than 40 days in May. Compare year over year for the same month when possible.
Segment by price band. Under about $2M, $2M to $4M, and $4M+ behave differently. Always read DOM and MOI within the price band that matches your target.
What signals buyer vs. seller leverage
Seller leverage signals:
- MOI consistently below about 3 months.
- Median DOM falling and staying low, often under about 14 to 21 days for lower price bands.
- List-to-sale price ratios close to or above 100 percent and fewer price reductions.
- Frequent multiple offers and upward pressure on median sale price.
Buyer leverage signals:
- MOI at or above about 6 months and DOM rising.
- More price reductions and longer time to pending.
- More contingencies or seller credits appearing in contracts.
Balanced market signals:
- MOI in the 3 to 6 month range and DOM stable.
- Some price reductions, but not widespread.
Quick examples to make it real
These are hypothetical to show the math. Always compare to current local numbers before you act.
Example 1: absorption and MOI
- Active listings: 30
- Closed sales in the last 30 days: 6
- MOI = 30 ÷ 6 = 5 months, which points to a balanced market.
- Absorption rate = 6 ÷ 30 = 0.20 per month. About 20 percent of inventory is selling each month.
Example 2: DOM by price band
- Median DOM under $2M: 18 days
- Median DOM over $4M: 72 days
- Takeaway: Lower-priced homes are moving quickly and may draw multiple offers. Upper-end homes have longer marketing windows, which is typical for that segment.
How to use DOM when buying in Alamo
If DOM is low and falling in your price band:
- Be fully underwritten or pre-approved and ready to act.
- Consider strong initial terms. Use escalation language only if you understand the risks and are comfortable with them.
- Tour quickly. Homes can go pending in under three weeks in hot segments.
If DOM is stable or rising and MOI is 3 to 6 months:
- You have some negotiation room. Consider offering at or near list with thoughtful repair or credit requests.
- Watch for listings that approach or exceed the median DOM. Sellers may be more flexible.
If MOI is above 6 months and DOM is rising:
- Ask for credits, rate buydowns, or repairs.
- Take time to compare comps and inspect carefully. The market is giving you room to be selective.
How to use DOM and MOI when selling in Alamo
If MOI is under 3 months in your band:
- Price close to market to capture early demand. Overpricing can still backfire.
- Expect faster showings and possibly multiple offers.
- Prepare for a shorter escrow. Line up disclosures, inspections, and vendor access early.
If the market is balanced at 3 to 6 months:
- Set a realistic, data-based list price and expect some negotiation.
- Plan for a 30 to 90 day marketing window.
- Watch nearby price reductions and adjust early rather than sitting stale.
If MOI is above 6 months:
- Lead with value: sharp pricing, standout presentation, and broad exposure.
- Be ready to discuss credits or repairs and extend your timeline.
- Refresh marketing at set intervals to stay visible to new buyers.
Avoid common pitfalls
- Do not read too much into one month. With few sales, a single outlier can skew the median.
- Clarify whether DOM is cumulative or resets after a relist. Cumulative DOM gives you a truer picture.
- Remember that off-market deals may not appear in the MLS, which can understate demand.
- Segment by property type and price. Mixing condos, small homes, and estates can hide important differences.
- Use medians rather than averages to reduce the impact of outliers.
What to track for a clean read
Build a simple two-part snapshot: the last 30 to 90 days and the trailing 12 months. For each, track:
- Active listings by price band
- Closed sales in the period
- Median DOM to pending and to close
- New listings and pending counts
- List-to-sale price ratio and median sale price
- Share of listings with price reductions and timing to first reduction
- Withdrawn, cancelled, or expired listings
This approach keeps you grounded in both short-term momentum and the longer trend, while controlling for seasonality.
Alamo takeaways you can use now
- For buyers: If you see low DOM and MOI under 3 months in your price band, act fast and lead with clean terms. If DOM is stretching and MOI is higher, negotiate for credits and take time to confirm comps.
- For sellers: Match your pricing and timing to the current MOI and DOM in your segment. In a faster market, focus on presentation and early demand capture. In a slower market, lead with competitive pricing and a strong, multi-channel marketing plan.
If you want a quiet, data-forward read on your specific home or target price band, reach out. You will get a clear, local perspective and a plan that fits your goals. Connect with Brad Gothberg to Request a Confidential Market Valuation.
FAQs
How is DOM counted in Alamo MLS?
- It depends on the MLS rules. Many systems show cumulative DOM that continues across relists, while others reset on relist. Always ask whether DOM is cumulative for the listing you are reviewing.
Are months of inventory and absorption rate the same thing?
- They are inverses. Months of inventory equals active listings divided by monthly sales, while absorption rate equals monthly sales divided by active listings.
What is a “hot” DOM number for Alamo homes?
- It varies by price band. For lower-priced single-family homes, DOM under about 14 to 21 days often indicates strong demand. Higher-priced homes typically have longer DOM due to a smaller buyer pool.
Can one metric tell me if it is a buyer’s or seller’s market?
- No. Read DOM, MOI, list-to-sale price ratios, price reductions, and short-term versus 12-month trends together. Also segment by price and property type.
How often should I check DOM and MOI before making a decision?
- For tactical choices like writing or accepting an offer, use the last 30 to 90 days and compare to a 12-month trend to control for seasonality. For bigger timing decisions, track broader trends over several months along with rates and local inventory.
