The absorption rate is one tool that a real estate agent can use in helping a seller to better understand their local market.
By using a particular time period, in this case the past 6 months, and comparing the number of sold homes in that time period with the number of current listings, the absorption rate can be identified.
And what is absorption rate? It identifies the rate at which a market absorbs (sells off) the inventory. If the market does not change and no new listing come on, the absorption rate tells you how many months it will take to sell off the current inventory. It gives you a sense of the pace of the market.
Using data for the past 6 months (November 13,2013 to today, May 13, 2014) the absorption rate for Kenilworth is 17.6 months.
Absorption rates can be identified as:
0-4 months - seller's market
5-6 months - steady market
6+ months - buyer's market
This does not mean that your Kenilworth house for sale will take 17 months to sell - but it does indicate a buyer's market. And it could mean a long wait and price adjustments along the way.