| 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 | ||||||
Rainer
5,804
5,804
Malou van Eijk
Foothills Real Estate
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