I am not sure why but I thought it would be fun to compare current absorption rates of housing with absorption rates from 10 years ago. In case anyone has forgotten ten years ago the housing market crashed and caused the great recession. These numbers are from before the Obama administration and before local housing prices hit rock bottom.
Absorption rates calculate how long it would take to sell all of the houses on the market at the current rate of consumption. The number is important because it has to do with the supply of houses and the demand for them.
Back in 2007, it was hard to sell a house:
Anoka County – 12.5 Months
Carver County – 11.7 Months
Dakota County – 9.8 Months
Hennepin County – 9.3 Months
Ramsey County – 10.2 Months
Scott County – 13.2 Months
Washington – 10.9
Here is a look at absorption rates today for the 7 county metro area which is like the 13 county metro area except smaller:
Anoka County – 1.7 Months
Carver County – 2.6 Months
Dakota County – 1.7 Months
Hennepin County – 1.8 Months
Ramsey County – 1.5 Months
Scott County – 2.2 Months
Washington – 2.2 Months
An appropriate graphic for the current absorption rate might be a q-tip. The reason I posted this is because when it comes to the housing market and the economy nothing is forever and there are no guarantees. There are no guarantees in life or in real estate.
I wonder what 2018 will bring? I have heard at least one prediction that the shortage of houses on the market will start to ease up a bit. We shall see.
