Dana Sharratt on Realty Absorption Rates.

06/07/2013

 There are only a certain number of houses that will sell in any market, in any price range, over any period of time.  Absorption Rate is a calculation of supply and demand for real estate.  It’s a simple calculation to determine the rate at which houses will be absorbed (sold) over a given period of time. This is important information for price positioning your home!

* A 6 month supply of homes is considered a balanced market.

  * < 6 months means that there is not enough supply to satisfy demand.  It becomes a seller’s market

  * > 6 month supply of houses, there is an oversupply, this becomes a buyer’s market

The following shows an example using specific criteria.  If you have any questions or would like a break down using different criteria just let me know! 780-913-9137 call or text.

Market Absorption Ratios (amount of inventory of similar comparable properties):

Criteria:     Single Family Dwellings in Leduc

Approx. square ft: unspecified

Garage or no garage

No style specified

Price range between $300,000-$350,000

Built 2007 or newer

Current amount of Inventory:  19

Past 12 Months SOLDS:  47

                                                3.9 sales per month

                                                4.87  months of inventory supply

Past 6 Months SOLDS:      25

                                                4.17 sales per month

                                                4.55 months of inventory supply

Past 3 Months SOLDS:      15

                                                5 sales per month

                                                3.8 months of inventory supply

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