Posted by Jonathan J. Miller -Tuesday, November 16, 2010, 12:01 AM
Absorption defined for the purposes of this chart as: Number of months to sell all listing inventory at the annualized pace of sales activity. I started this analysis in August 2009 so as of late I am able to show side-by side comparisons. The blue line that shows the 10-year average travels up and down because of the change in scale caused by some of the significant volatility seen at the upper end of the market.
We are starting to see some weakness at the lower end of the price spectrum this month, possibly in connection with the expiration of the federal tax credit. Sub-$500k apartments are seeing a higher absorption rate than their $500k+ counterparts. However, absorption rates as compared to last year are still generally lower across the board by price and region.
Side by Side Comparison: October 2010 v. October 2009
[click images to expand]
Note: This chart series does not include shadow inventory (properties ready for market but not yet listed for sale) so this anlaysis understates the rate of condo absorption. The Uptown (Northern Manhattan) data set is too thin for a reliable presentation.