April 22nd, 2021

Bozeman Absorption Rates

Photo Bozeman Absorption Rate Taunya Fagan Bozeman Real Estate

2021 Bozeman Absorption Rate ⇑ Through The Roof

How To Calculate Absorption Rate – What’s Bozeman’s Absorption Rate?

Absorption Rate (AR) indicates how long it takes a Bozeman home (or any property) to sell in a particular area and in a specific time period.

All BozemanMarch 20216659

One type of Absorption Rate is calculated in “percentage of all homes” sold each month.

Number homes For Sale Bozeman, Inside and Outside City This form of Absorption Rate is calculated by dividing the number of active homes for sale in a given month by the number of homes sold in a given month.

(You can use any time period, as long as you adjust the number of homes sold to coincide with that period.)

Absorption Rate, Chance of Selling: Sold Homes/Available Homes For Sale = 66/59 = 112% chance of your Bozeman home selling in one month. (Therefore, it could take less than a month to sell!)

A rate above ~18-20% indicates a seller’s market and below ~15-17%, a buyer’s market. Bozeman’s AR percentage comes in significantly higher than 18-20%!

A second type of Absorption Rate calculation results in “number of months to sell.”

Absorption Rate, Months To Sell: Homes For Sale/Sold Homes = 59/66 = .89 months to sell a home in Bozeman in March 2021.

Generally, Average Days on Market decreases as the Absorption Rate increases.

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Taunya Fagan

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