Absorption Rates (?) in Calabasas
Have you heard the term absorption rate before? Are you familiar with it? The basic definition of absorption rates as they pertain to real estate is as follows. The Absorption Rate is the ability of the real estate market to absorb or sell all of the houses for sale in a given amount of time. For example, if 100 homes are sold every month and there are 1200 homes for sale, it will take 12 months to sell all of the homes currently for sale. If there are 2400 homes for sale, the absorption rate will be 24 months or 2 years for all of the homes to sell, this does not take into count the number of houses which will eventually come on the market in addition to those already for sale.
As real estate agents we use this analysis to help our clients familiarize themselves with the current market conditions and help them decide how they want their home sale to perform in that market. It would stand to reason that if two homes that are very similar in condition, size, location and so on were both on the market, the more affordable home would sell first. Below are some current absorption rates for Calabasas. We chose to focus on 3 areas of the city but if your home is located in another community, please contact us for absorption rates and other statistics for your area.
The Oaks of Calabasas
There are currently 17 home active on the MLS. 18 homes have sold in the last 6 months and 36 homes have sold in the last 12. Based on those number, there is an average of 3 homes per month selling in The Oaks of Calabasas. With 17 homes on the market, it would stand to reason that there are about 5.66 months of inventory currently on the market.
Mountain View Estates
There are 15 homes on the market and only 2 in pending status. There have been 9 sales in the last 6 months and 15 in the last 12 months. The absorption rate for this community is somewhere between 10 and 12 months.
There are only 5 homes on the market in the Calabasas Hills community and with 14 sales in the last 6 months and 19 in the last year there are only between 2.1 and 3.1 months worth of inventory.
If a seller is in a community where the absorption rate is on the high side, they can use that information to assist in the pricing of their home. Knowing not only what your competition is, but how that competition directly affects your ability to sell is very useful information.