Okay, what is an absorption rate and why should you care? That’s a good question and I’m glad that you asked! Absorption rate is a way to look at the number of properties currently on the market and then using the number of recent sales, allows you see how long it would take for every property currently on the market to sell if no new properties became available for sale. This figure helps you to see if the market is speeding up, slowing down or staying level.

Let’s jump in with an example of Single Family Homes in Medford

Right now there are 86 Single Family Homes for Sale in the city of Medford, MA. If we didn’t allow any new properties to be put on the market, it would take a little over 4 months to sell all of the homes currently for sale.

If you compare this to the absorption rate from last year, you’ll see that our market is improving because about a year ago, the absorption rate was over 8 months.