Absorption Rate in Real Estate… How slow is the market?

So, one of the first questions buyers always ask me is “how long has it been for sale?”. I think they want to know because they are hoping it will tell them how desperate the seller is becoming. If I say 200 days, are they going to severely low-ball the seller? Probably. In this market, however, it is becoming less and less of a surprise when a home has been on the market for a good, long while. Here are some numbers that might help you to see how “slow” our market actually is. It differs from area to area, so I just chose a few different ones to illustrate this.

Kansas City, Missouri: Currently, there are 4,571 houses for sale (that’s just single family homes, not any of the other types of housing). There have been 7,389 homes sold in the past 12 months. This tells me that at this rate that homes are selling, it would take us 7 months to sell the 4,571 homes that are for sale.

Brookside (64113 Zip Code): Currently, there are 137 houses for sale (that’s just single family homes, not any of the other types of housing). There have been 288 homes sold in the past 12 months. This tells me that at this rate that homes are selling, it would take us about 5 months to sell the 137 homes that are for sale. This is a healthy rate.

Condos in Kansas City, Missouri (from the River south to about 75th St): Currently, there are 834 condos/lofts for sale. There have been 563 condos/lofts sold in the past 12 months. This tells me that at this rate that condos are selling, it would take us 17 months to sell the 834 condo/lofts that are for sale.

This is called Absorption Rate – the rate at which properties are able to be sold in a given area. Always check with your Realtor if you are selling your home and take this very important number into consideration when you are pricing your home for sale.