Get your free monthly report of the number of Homes Sold per month, Median Sales price, the Sold to List price, the average Days on Market (DOM), the absorption rate (the time it takes to sell inventory on the market) and much more. This report provides to you an indication of the best price to list your house and the expected time to sell it.
The absorption rate indicates the amount of time it takes to sell homes based on the market’s previous performance. The absorption rate can be done for a small geographical area such as a neighborhood or as large as an entire county.
How many months back should you look in determining the how to price your house and forecast how quickly it will sell? It is recommended to go to the most recent 3 months using the same criteria as your house in the same or similar neighborhood. To forecast the length of time to sell, three months back is recommended looking at the rate in which houses are selling and then compare this figure with the current month’s supply of houses (your competition).
The general rule is the following:
• Sellers’ market conditions—Absorption rate is 1–4 months
• Normal market conditions—Absorption rate is 5–6 months
• Buyers’ market conditions—Absorption rate is 7+ months
Understanding market conditions is an important factor in setting a price range for your property. It is important to work with a Realtor® who is a Pricing Strategy Advisor and can guide you to getting the most out of your house.