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Suffolk County Absorption Rate

I’m sure you’ve heard that there is currently a scarcity of housing inventory virtually everywhere especially on Long Island in both Nassau and Suffolk Counties.  The statistic you possibly are NOT hearing about, however, is that there is a significant increase in activity, with many more homes going into contract than ever before.

So to put it a different way, inventory is DOWN while the pace of sales is UP!  When that happens, something called the “absorption rate” declines quite drastically.  The absorption rate is no more than the number of months to sell ALL the homes on the market. For example, if 100 homes were on the market and 100 homes sold over the past year, that would be a 12 month absorption rate.  If however, 100 homes were on the market and 200 homes sold over the past year, that would be a 6 month absorption rate.

A normal market, that is a market favoring neither the buyer nor the seller holds a 5 to 6 month supply of housing.  An absorption rate higher than 6 months is a “buyer’s market” while lower than 5 is a “seller’s market.”  You can see this quite plainly in the chart just below.

Absorption Rate

With a clearer understanding of what the absorption rate means in housing, I’m sure you can see from the following chart just how strong a seller’s market it is in Suffolk County right now for single-family homes!

Suffolk County NY Absorption Rate
Suffolk County NY Absorption Rate Feb 2020

What this should mean if you are thinking of selling your Suffolk County single family home: The time to think is over! It is time to act and act swiftly before more sellers discover what you now know.  The absorption rate has never been lower than I can remember in my 21 years in real estate and there’s just no telling how long this seller’s market is going to last. Call me at 516-429-9399 if you would like to know about market conditions and the absorption rate in your town or what your home could bring in today’s market, without any obligation – of course!