Solano County Realestate Blog

Months of Inventory & Absorption Rate
June 14th, 2014 3:07 PM


About the Months of Inventory Report
 
 

  1. Months of Inventory based on Closed Sales (MOI based on Closed Sales)
    MOI based on Closed Sales = the number of properties for sale divided by the number of properties sold.

How to Use Months of Inventory Report?

Refer to
For Sale vs. Sold Report for the number of properties for sale, pended and sold that are used to calculate the Months of Inventory report. As a rule of thumb, an inventory level of less than three indicates a strong seller market while an inventory level greater than six indicates a buyer's market.

Fairfield, Suisun, Vacaville CA Single Family Homes Under $450,000
1.1 Months of Inventory as of 05/14/14

 Over $450,000 - $900,000
2.9 Months of Inventory as of 05/14/2014

 
  

 

Absorption Rate

About Absorption Rate Report
 
 

  1. Absorption Rate based on Closed Sales (%)
    Absorption Rate based on Closed Sales (%) = the number of properties sold divided by the number of properties for sale (in percentage).
    For instance, if there are 1,000 active listings and 100 of them sold in a given month, the rate of absorption would be 10%. 10% of the market is being sold in that given month.

The Rate of Absorption measures the inverse of Months of Inventory and represents how much of the current active listings (as a percentage) are being absorbed (sold or pended) each month. The Absorption Rate is presented as a percentage (%) of the current inventory.

How to Use Months of Inventory Report?

Refer to For Sale vs. Sold Report for the number of properties for sale, pended and sold that are used to calculate the Months of Inventory report. As a rule of thumb, an absorption rate of less than 16.67% indicates a strong buyer market while an absorption rate level greater than 33.33% indicates a seller's market.


Absorption Rate Fairfield, Vacaville, Suisun. Single Family Homes Under $450,000
87.5% Absorption rate as of 05/14/2014


Over $450,000 - $900,000
34% Absorption Rate as of 05/14/2014


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Posted by Larry and Kitty Powers on June 14th, 2014 3:07 PMPost a Comment

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