The news for Londonderry home owners trying to sell their houses, or thinking of selling their homes appears to be getting better. Today I calculated the absorption rate for Residential and Condominum properties in the Town. The absorption rate is a simple calculation to determine how long it will take the market to absorb the current amount of inventory that is for sale.
Inorder to calculate the absorbtion rate you take the total amount of solds for Residential and Condo's last year (344), and divide this by 12 to get a per month sold amount of 28.67. Then take the amount of Residential and Condo's that are activily on the market (189 listings) and divide this by the per month sold figure from 2007:
189 Current Listings divided by 28.67 solds per month = 6.5 months absorbtion rate.
The absorption rate of 6.5 months means that at this current time it will take approximately 6.5 months for the current market to absorb the listings that are currently on. When looking at absorbtion rates the general rule of thumb is that if the absorbtion rate is above 6 months, you are in a Buyers Market. If the number is below 6 months you are moving towards a Sellers Market. This current number of 6.5 means were still in a Buyers Market in Londonderry, but we are doing much better.
Inorder to put Londonderry's current market situation into perspective, currently the Town of Windham has a 9.72 absorption rate and Rockingham County's absorption rate is at 10.43. Sellers in Londonderry should take a lot of comfort in this number, since it shows that compared to the County we are doing fairly well.
**Absorption Rate figures based off of properties between $100,000 - $900,000**