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Tom and Joan…, Real Estate Pro in Boston, MA

How important is Absorption rate for your market?

Asked by Tom and Joanne Team, Boston, MA Fri Sep 23, 2011

Do you investigate absorption rate while preparing a CMA and if so do you find it to be a tool that sellers understand?

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Yes, I do and while it is something that has to be explained, most of the sellers do grasp it after explanation. I find it a valuable tool, especially if you have a seller whose property 'hugs' between two price ranges.
0 votes Thank Flag Link Fri Sep 23, 2011
Absorption rates are great for reports of for use in commercial or even when used for loan purposes, but it doesnt show you if you price the home at or just below market value it will sell quicker than if you over price it.
Web Reference: http://www.ScottSellsNH.com
0 votes Thank Flag Link Fri Sep 23, 2011
I do enjoy figuring absorption rates. I have used them to show sellers a little more information about their local market. Of course absorption rates are really only good for a short period of time. If you follow the data for several months you can get a better picture of the market. I have used them with buyers too so that they can realize that when the nightly news says we are in a buyer's market that might not be true for the neighborhood they are looking in.
0 votes Thank Flag Link Fri Sep 23, 2011
Yes. I add this to CMA's and BPO's. Thanks!
0 votes Thank Flag Link Fri Sep 23, 2011
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