Often we receive questions as to how one calculates an "Absorption Rate" for Montana Real Estate and Homes.
Calculating SW Montana Homes Absorption Rate for 2011:
1. Time Frame is total days from January 1 to December 31 = 365 days
2. All Sold SW Montana Homes, all Areas from January 1 to December 31 = 1,910
3. All Active SW Montana Homes, all Areas at the end of December 31 ≈ 1,250
Absorption Rate Calculation Details:
Rate of SW Montana Home Sales ≈ .1911. Therefore, ONE SW Montana home is sold approximately every .1911 DAYS. This number is calculated in this way: divide 365 by 1,910 ≈ .1911 (Time Period/Number of SW Montana Homes Were Sold, precluding Recreational, To Be Built, and Timeshare properties.)
Absorption Rate ≈ 239 DAYS, about 7.96 months, so we'll round to 8 MONTHS as the Absorption rate for the year 2011. This number is calculated in this way: multiply 1,250 times .1911 ≈ 239 days (Total Active SW Montana Homes x Rate of SW Montana Home Sales.)
ABOVE: Total Number of Residential SW Montana Real Estate Listings Sold, January to December 2011
ABOVE: Approx. Number of Residential SW Montana Real Estate Listings For Sale on December 31, 2011
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