Knowing if the market you're interested in buying or selling a home in is a Buyer's Market or a Seller's Market is an overlooked, but important piece in determining a home's value.
Buying or selling a home soon?
Learn why absorption rates are important and how knowing if it's a Buyer's Market or a Seller's Market will help you avoid making costly mistakes like overpaying for a home or having your home sit on the market indefinitely.
The Absorption Rate is the amount of time it would take to sell all of the current listings at the current selling rate if no more homes were listed for sale.
It is calculated by dividing the average number of homes sold over the last six months by the total number of homes listed for sale at the end of the month.
For example, if 60 homes sold in the last six months (average of 10 homes/per month) and 100 homes are still listed for sale at the end of the month, there are ten months of home supply in the market (100 homes divided by 10 homes sold/per month = 10 months).
Why is it important to know the Absorption Rate?
The Absorption Rate is the key indicator for knowing if it's a Buyer's Market or a Seller's Market.
Typically, a Seller's Market has less than six months of supply, while more than six months indicates a Buyer's Market.
A buyer who is aware that it's a Buyer's Market not only has more homes to choose from, she may also be in a position to offer less for a home or request additional items in her offer, such as seller concessions or repairs completed by the seller.
A seller who is aware that it's a Buyer's Market may price her home slightly below the recent comparable sales to avoid having her home sit on the market indefinitely and ultimately sell for less than what she could have sold for.
Coral Gables - Buyer's Market or Seller's Market?
The graph below breaks down the absorption rates for all single-family homes in Coral Gables by price bands and demonstrates how the different price segments of the Coral Gables single-family homes market have performed over the last six months.
The market for single-family homes in Coral Gables is currently an Extreme Buyer's Market with 9.7 months of inventory.
Generally-speaking, buyers have more negotiating leverage than sellers at this time.
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This easy-to-understand Coral Gables market report break down the most important information and equips you with the knowledge necessary to make informed decisions.