Found 1 blog entry tagged as Absorption Rates.

By Tom Reed, Partner & Broker-In-Charge
Charter One Realty 

Market improvement on both the Island and the mainland continues to be both price dependent and use dependent where the improvements are beginning at the lower price points and working their way into higher and higher price points. When one breaks down the market by price and property type, absorption rates can be used to determine the market health for the various segments.

Absorption rates ask the following question: “Based upon current consumption rates, how long will it take to consume all current inventory within the market segment in question?”. The breakpoint is six months worth of inventory representing a balanced market with no pricing pressure. Market segments with less than six…

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