Gail MacMillan, Broker - Titusville, Brevard County FL : MARKET ABSORPTION RATE FORMULA

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MARKET ABSORPTION RATE FORMULA - Made Easy!!!

By: Gail MacMillan
Sunday, January 13, 2008 6:06 PM

I know it's been done before but I want to share the formula I use because it
seems easier than some others I've come across.

INVENTORY

The total number of houses for sale within a defined market area

ABSORPTION RATE

The rate at which homes will sell within a given period of time or unit sales per month

EXAMPLE

48 sales in 6 months ~ divide the # sales by the # months = 8 sales per month

MONTHS OF INVENTORY

Time required to sell all existing homes ~ divide inventory by absorption rate (# sales per month)

EXAMPLE

88 houses in current inventory divided by 8 sales per month = 11 months of inventory

___________________________________

If you find this formula useful, please pass it along :-)

Gail MacMillan Broker®
Home Sweet Home Florida Realty, Inc.
At Home With Diversity (AHWD)
Certified Residential Specialist (CRS)
e-PRO Internet Certified (e-PRO)
Graduate Realtor Institute (GRI)
Relocation Specialist
Titusville, Florida
Cell: 321.544.6808

www.HomeSweetHomeFlorida.com

Also posted on ActiveRain: http://activerain.com/blogs/homesweethomeflorida

Comments

Member Since '04	The C Team said: Thanks Gail. Appreciate your sharing. Darcy January 14, 2008 9:47 AM
Member Since '03	Gregory Bain said: Thanks, Gail. That must be the quantum physics formula they are looking for on the other thread. Any who, the MLS in my area has done a collection of reports for those of us that can't add. It is pretty neat to look at the old rate of 4 months back at the end of summer 2005 and see the new rate of 18 months. I guess I better get busy and start selling those houses. January 14, 2008 3:48 PM
Member Since '05	Gail MacMillan said: Hi guys, You're welcome, I've seen that quantum physics formula and it made me zone out. This one is just a tad more friendly. Thanks for stopping by. January 14, 2008 6:59 PM
Member Since '05	Lonn Dugan said: Quantum Physics Formula? Dreams + Faith = Results? That one? That's not really so hard to DO as it is to BELIEVE : ) January 18, 2008 6:42 AM
Member Since '03	Gregory Bain said: Lonn, thanks for the formula. If I am ever on the TV show Survivor, I'd want you with me. Because you do know how to start a fire. Not a very useful skill here on P2A; but, on reality (sic) TV? You the man. Then again, maybe you don't even know you start fires. In that case buy a smoke detector. January 18, 2008 9:36 AM