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2008 Absorption Rate in Crofton Real Estate

As we celebrate New Year’s Day 2009, a question looms for all of us interested in Crofton real estate…  What can we expect in 2009?

No one has a crystal ball – at least, not a perfectly focused one – but we can look at some indicators from the past year for an educated guess about what the future holds.  In addition to the eight factors affecting Crofton real estate in 2008, which I posted on New Years Eve, the ABSORPTION RATE may give us a window into the coming months.

Absorption RateAbsorption rate is the length of time it would take all the homes currently on the market to sell, based on recent sales history. 

Let’s look at figures for zipcodes in the Greater Crofton area, using listings and solds reported by MRIS (our regional multiple listing service).  

“Current listings” are the homes listed for sale as of today, January 1, 2009, with a breakdown of detached homes and townhomes/condos in parentheses.  “Sold listings” is a figure based on the total number of homes that went to settlement in 2008, divided by twelve to get a monthly average.  Calculating the monthly average will help level off the extreme ups and downs we experienced in the real estate market last year.

CROFTON (21114): 

  • 96 current listings (26 detached homes / 70 townhomes/condos)
  • 48 sold listings (16 detached homes / 32 townhomes/condos)
  • 2 months absorption rate   

DAVIDSONVILLE (21035):

  • 62 current listings (62 detached homes / no townhomes/condos)
  • 13 sold listings
  • 4.77 months absorption rate 

GAMBRILLS (21054):

  • 64 current listings (40 detached homes / 24 townhomes/condos)
  • 16 sold listings (12 detached homes / 4 townhomes/condos)
  • 4 months absorption rate

ODENTON (21113):

  • 160 current listings (28 detached homes / 132 townhomes/condos)
  • 63 sold listings (12 detached homes/ 41 townhomes/condos)
  • 2.5 months absorption rate

Sold HomeIn plain language, the absorption rate indicates it would take two months for all of today’s current listings in Crofton to sell IF no new listings were added to the inventory (4.7 months in Davidsonville, 4 months in Gambrills, 2.5 months in Odenton).  Of course, new listings will come on the market, so the absorption rate is merely an indicator, not a guarantee, of how long it will take to sell a home in the area.

Absorption rate is just one of the MANY factors I will consider when making a pricing recommendation to you when you list your home with me.  And I will narrow down the calculations to your specific neighborhood, as well as the zipcode.

Frankly, the state of the credit market will probably impact home sales and time on market more than any other single factor.  Thank goodness for the “BRAC Factor” which continues to funnel home buyers into our market, in spite of the struggling economy. 

In this challenging real estate market, price is more important than ever before.  It is critical that you get it right the first time, when your home first goes on the market.

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