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Absorption Rate, A Worthy Statistic All By Itself.

If you are interested in buying real estate in Summit County you may start looking at market statistics to get a feel for the state of the market.  Those market statistics may not mean much until they are put into the perspective of the Summit County market.  If you hear that there are 1000 properties for sale, it’s hard to know what that means.  Is it a seller’s market or a buyer’s market?  Are the 85 sales last month exceptional or terrible?  Without some context, statistics are relatively useless.  That’s why one of the statistics we look at every month is the absorption rate.  It automatically puts the statistics into the context of the market.  That means, even with no additional information, you know where the market is.

Absorption by area 10-15Absorption rate is the relationship between inventory and past sales.  If in the last year there have been 1200 sales and now there are 300 properties on the market, it is is a fair assumption that it will take 3 months to sell all the inventory.  1200 sales in one year equal 100 sales per month.  Therefore, 300 properties should take 3 months to sell.  The absorption rate in this example is 3 months.  In most markets, three months of inventory is a Seller’s market.

Looking at the Summit County market through the end of October the absorption rate is 3.6 months; a sellers market.  When diving deeper into the data we see that Keystone and Breckenridge are both seller’s markets with 3.3 and 4.8 months of inventory respectively.  Dillon, Frisco and Silverthorne are extreme seller’s markets with 1.6, 1.7 and 2.3 months of inventory.  Copper is still a buyer’s market with 8.9 months of inventory.

With just this one statistic, you have a much clearer picture of the Summit County market.  As a buyer or seller, by looking at the absorption rate you have a general overview of what is happening and what to expect.  Additional information will help dial it down even further but absorption rate is a fantastic statistic that should be utilized.

Posted in: Market Statistics Tagged: Absorption Rate

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About Us

Mountain Living Real Estate, a.k.a. The Mountain Living Team, is a family owned, second generation, real estate company that has been helping buyers and sellers in Summit County since the early 90’s.  Mountain Living Real Estate is committed to going above and beyond to ensure their clients have the most amazing real estate experience possible.  Jason & Meredith take a personal approach to educate their clients, empowering them to make high quality decisions no matter the situation.  They take exceptional care throughout the sales process and beyond; striving to make each client’s path in Summit County one filled with fun, excitement & great memories.

Work with Mountain Living Real Estate and you’ll understand why so many people say, “We Love Mountain Living!”

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Jason and Meredith Adams

Jason & Meredith Adams
Mountain Living Real Estate

101 Main St, #109, PO Box 4115 Frisco, CO 80443

(888) 666-0844
team@mountain-living.com

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Jason & Meredith Adams are both licensed to sell real estate in the state of Colorado

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