| Absorption Rate |
| The absorption rate is the speed (rate) at which houses, matching particular criteria, are sold. |
| Area/Neighborhood____Genesee_______ |
| Syle of House____Mountain__________ |
| Age of House__________________________________ | 1975-2000 |
| Size of House__________________________________ | 3500-4500 |
| Price Range___________________________________ | 700-1.1M |
| Other_________________________________________ |
| Using the above Criteria, The Multiple Listing Servie (MLS) reports that there were _____11__ |
| houses sold in the last __6______ months. Dividing the number of sales by the number of |
| months, tells us how many homes (meeting the above criteria) the market is absorbing each |
| month, i.e., the monthly absorption rate. |
| 8 | / | 6 | = | 1.3333 |
| Number of Sales | Number of Months | Sales per month |
| Months of Inventory |
| Using the absorption rate data the criteria above, we can now calculate how many months of |
| inventory here is on the market for houses meeting that criteria. |
| The MLS reports that there are ___20_______ houses currently for sale (active listings) that meet the |
| criteria. Dividing the number of active listings by the number of sales per month tells us how many |
| months it will take to sell the existing inventory. |
| 11 | / | 1.33333 | = | 8.25 |
| Number of Active Listings | Number of Sales per month | Number of months needed |
| to sell existing inventory |
| Sellers Market | Transitioning Market | Buyers Market |
| 1-3 Months | 3.5-6.5 Months | 7-12 Months |
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