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figuring absorption rate: How Absorption Rate is figured - 11/14/06 11:09 PM
Knowing your area's Absorption Rate, helps to track trends.  Understanding the market and where it is headed is part of our job as real estate professionals.
Absorption rate is NOT an exact science.  Figuring it is based on the premise that one will be looking for a TREND.  It is advised to consistently do the numbers each month, to be able to track a trend.
Getting Starting...
You need to know 2 figures.
1) How many listings are currently on the market?
2) How many listings sold last month?
You will be counting under-contract or pendings as listings, since they are not SOLD yet.
(95 comments)

 
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