Knowing the absorption rate in your area is a great asset when looking to purchase or sell a home in Northfield. The absorption rate is actually a formula that tells you how long the current inventory of homes would take to sell if no new homes came on the market.
In other words, it's the rate at which the market absorbs or eliminates current inventory. It determines this by the current rate of home purchases made by buyers.
The absorption rate categories look like this;
If a home sells in under 4 months, it is considered a seller's market and prices are increasing. If it takes longer than 7 months, then it's a buyer's market and prices are pushing downward. Here are the absorption rates for various parameters in Northfield:
The hottest selling properties in Northfield are single-family homes priced under $1 million and all condos. Since Winnetka has such a scarcity of condos, many sellers in Winnetka are moving to Northfield and condo inventory is selling quickly.
Otherwise, three categories fall into the buyer's market category with longer days-on-market, and all 4-bedroom homes are selling in a balanced market. Neither the seller or the buyer have a distinct advantage in that scenario.
What's interesting about determining the absorption rate is that allows you to see exactly where sales are happening and where they are not. And this information should help when pricing your home or bidding on one.