How To Use The Housing Turnover Rate To Beat Your Competition

Real Estate Agent with Joe Manausa Real Estate 8508880888

Real Estate Turnover RateIf you are thinking about selling a home in the near future, make sure you determine the housing turnover rate for your neighborhood.

The housing turnover rate is simply the pace at which homes are selling for homes like yours, in your area, and often times this is referred to as the "liquidity" in the market.

So many homeowners allow a real estate agent to give them pricing guidance without first understanding the liquidity in the market, and that is a great way to join the ranks of other people who have failed to sell a home.

Study Supply To Find The Housing Turnover Rate

When we are looking for the housing turnover rate in Tallahassee, we find a market that is purely working in the favor of buyers right now. The following table shows the relative supply of homes for sale in Tallahassee, and every single area and every single price range is still above 6 months of supply.

Tallahassee real estate turnover rate

As an example (in the table above), the Northeast Tallahassee housing market has 12.4 months of supply of homes priced between $250,000 and $300,000. Simply put, if no new homes enter the market at that price point (and nobody in the price range above reduces their price into it), then we have all the homes need for more than 12 months at our current rate of demand. This is not good if you own a $250,000 home to sell in Tallahassee.

Tallahassee Housing Turnover Rate

The following table shows the housing turnover rate in Tallahassee. It is the current monthly rate of demand (the number of homes that should sell each month in the Tallahassee MLS/ not seasonally adjusted).

turnover rate each month

So using the $250,000 to $300,000 price range in NE Tallahassee, home sellers should expect 10 homes to sell each month. Of course, we know that fewer homes sell this time each year than do so in the Summer, so I would expect 8 to sell in the month of September. If you have a home to sell in this price range and area, don't you need to be one of the top 8 best deals in order to sell this month?

Competition And The Housing Turnover Rate

Now that we know the current housing turnover rate, we only need to look at the competition to help us determine the best price point, right?

calculate real estate turnover rate

Again, using the $250,000 to $300,000 priced homes in NE Tallahassee, we can see that there are 124 on the market. If you want to give your home the best chance to be sold in the next thirty days, you have to be among the best 8 homes in this 124 home group (top 6%). That's right, only 6.5% of these homes on the market will sell in September, will one of them be yours?

It can be! If you would like to know how to get your home sold fast, by having a great understanding of the housing turnover rate, just drop me a note and we can schedule a time to evaluate your home and your specific situation.


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Joe Manausa
Joe Manausa Real Estate - Tallahassee, FL
Tallahassee Real Estate

Margaret, our MLS provides very little, I produce these myself.

Sep 07, 2012 04:02 AM #16
Debbie Cook
Long & Foster Real Estate, Inc - Silver Spring, MD
Silver Spring and Takoma Park Maryland Real Estate

Our MLS system in Maryland, Va and DC has this info for agent at the click of a mouse.  I couldn't imagine trying to produce this info on my own, like you do!  However, having to do it yourself makes you a much better expert in your market.

Sep 07, 2012 05:08 AM #17
Joe Manausa
Joe Manausa Real Estate - Tallahassee, FL
Tallahassee Real Estate

Oh, I don't know about that Debbie, so long as you stay vigilant in tracking, who cares who creates it :) I'm jealous!

Sep 07, 2012 05:16 AM #18
Erica Ramus
Erica Ramus - Ramus Realty Group - Pottsville, PA - Pottsville, PA
MRE, Schuylkill County PA Real Estate

Love your market reports and explanations Joe!

Sep 07, 2012 06:53 AM #19
Sharon Alters
Coldwell Banker Vanguard Realty - 904-673-2308 - Fleming Island, FL
Realtor - Homes for Sale Fleming Island FL

Joe, this sounds like another word for absorption rate - and what a great way to phrase it. Many people have difficulty understanding "absorption rate" but liquidity - everyone is familiar with that term. And ditto what Erica said!


Sep 07, 2012 02:56 PM #20
Frank Castaldini
Coldwell Banker - San Francisco, CA
Realtor - Homes for Sale in San Francisco
Very interesting way to look at markets. Since I don't know anyone doing this it's clear that using this can make one stand out. Thanks. Thought provoking.
Sep 07, 2012 03:20 PM #21
Jennifer Manchester
Suburban Properties of Charlotte, LLC - Mint Hill, NC
GRI, ePRO, ASP - Broker/Home Stager

Good information Joe:

I always include market data and absorbtion rates in my listing presentation.  If clients still want to overprice after I have taken the time to show them the data and explain it, I walk away.

Sep 07, 2012 11:33 PM #22
Bob Crane
Woodland Management Service / Woodland Real Estate, Keller Williams fox cities - Stevens Point, WI
Forestland Experts! 715-204-9671

Great information Joe, nobody analyzes the housing market like you do, and I always walk away learning something valuable.




Sep 08, 2012 12:16 AM #23
Gary Burleson
Beach Water Realty - - Myrtle Beach, SC
Myrtle Beach Homes, Condos, Foreclosures, Investment Propery

Joe, I did something like this years ago, but for some reason got away from using it. I think I need to start using this again, it's great information for the buyer and seller.

Sep 08, 2012 12:23 AM #24
Ron Aguilar
Continental Mortgage - Saint George, UT
Mortgage & Real Estate Advisor since 1995

the absorption rate is also helpful for those listing appointments, excellent post

Sep 08, 2012 12:34 AM #25
Sharon Parisi
United Real Estate Dallas - Dallas, TX
Dallas Homes

Statistics are always worth their weight in gold, especially when the competition is unaware of the stats!

Sep 08, 2012 01:32 AM #26
Michael Blue
Home Smart Realty West - Encinitas, CA
REALTOR - 760-889-8877, Encinitas/Carlsbad
The absorption rate is also used by many of us performing BPOs.
Sep 08, 2012 01:35 AM #27
Joe LaVallie
HomeStreet Bank - Mountlake Terrace, WA

I like statastics to backup the type of market you are selling into.


Sep 08, 2012 01:47 AM #28
Kim Mulligan
Cooper Jacobs Real Estate - Seattle, WA
Selling Homes for the 21st Century

Great way to illustrate how demand for a home is dictated by the market, not the home on it's own merits. It really does depend on the home being the best in it's price range. Thanks for the reminder of explaining this to our clients.

Sep 08, 2012 06:19 AM #29
Bob Miller
Keller Williams Cornerstone Realty - Ocala, FL
The Ocala Dream Team

Hi Joe, great post.  We do something verry similar but now also color code it to buyer market, vs seller market.

Sep 08, 2012 11:42 PM #30
Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Specializing in Brookside, Waldo, Prairie Village

What a great resource for buyers and sellers in the area!  You break it down well.  Stats don't lie!  I may try something similar for my area.

Sep 09, 2012 12:03 AM #31
Lyn Sims
RE/MAX Suburban - Schaumburg, IL
Schaumburg IL Area Real Estate

Joe, as usual great report updating the sellers in your area. Nice how you broke it down into price ranges. That's important because each level sells differently.

Sep 09, 2012 12:34 AM #32
Evelyn Kennedy
Alain Pinel Realtors - Alameda, CA
Alameda, Real Estate, Alameda, CA


At our last office meeting my broker calculated our turnover rate for my city to be one month.  We had so little inventory houses are flying off the market.

Sep 09, 2012 03:39 AM #33

Joe, in reporting on a turnover rate as of 12-1, do you employ just the previous month's number of sold homes, or do you use an average # of sold homes for the subject area since the previous January 1, for example? Some trainers make a case for the  former. So I wondered about your own calculation.

Dec 02, 2012 08:49 AM #34
Joe Manausa
Joe Manausa Real Estate - Tallahassee, FL
Tallahassee Real Estate

Hey Richard, I use 12 month average (remove seasonality).

Dec 02, 2012 09:21 AM #35
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