Absorption rate change
Year-over-year change in absorption rate
|State Name||Year-over-year change in absorption rate|
|District of Columbia||-12.9%|
|New Mexico||No data|
|North Dakota||No data|
This map shows the fluctuation of the absorption rate per state from October 2017 to March October 2018, and illustrates some regional trends as well.1 The absorption rate refers to the rate at which homes sell at the current market pace. It’s calculated by using three data points: time frame, number of homes sold within that time frame and number of active homes within the time frame. A lower absorption rate means less homes are being sold in a specific time period, indicating more supply and lower home prices. A higher absorption rate implies less supply and higher prices.
Nationwide, the absorption rate for October 2018 was 58.3%, which is down 14.4% from a year ago. Interest rates and affordability may be contributing factors to the decrease in many parts of the country.
Absorption rates declined in 37 states from October 2017 to October 2018. The five states with the largest decreases were South Dakota (-39.3%), Hawaii (-36.4%), California (-34.8%), New York (-34.3%) and Washington (-32.6%). This may signal moderate cooling of buyer demand there.
Meanwhile, Idaho and Louisiana showed absorption-rate growth of 15.1% and 11%, respectively, which may suggest that buyer demand exceeded available housing inventory.
1 Source data: CoreLogic®
Data date: 01/10/2019
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