The 60 day absorb rate is a measure of market speed in the same way a speedometer measures the speed of a car. When we are in a car and our speed is steady (no acceleration), we can feel and gather speed impressions by relating to the passing landscape. If we are going slow, say 15 mph, we “know” we are going slow.  The market offers few visual clues as to speed and direction and can be misinterpreted or misunderstood, especially during periods of change. Like a pilot flying at night, the agent must keep his attention focused on his gauges to determine with accuracy the direction and speed of the market. The absorb rate is one such gauge.  If the absorb rate is rising the market is moving toward the seller. If declining, the movement favors the buyer.  If the absorb rate is a low number, the market is converting listing to closings at a slow or low rate.

THE BIG PICTURE

• 􀂾 DEMAND: 72 unit increase over last month.

• 􀂾 SUPPLY: Very steady in the current range—little change.

• 􀂾 FAILURES: Holding very steady in current range.

• 􀂾 PRICES: All price indicators continue negative. Note that pending price lies below closing price pointing to continued price weakness. A positive note for sellers is that the decline in pending price is slowing, implying a slowdown in the rate of decline for closing price in the near future.

• 􀂾 60 DAY ADSORB: Market speed (conversion of listings to closings) increased by 4 points.

• 􀂾 PERCENT SELLING: Increased by 4 points.

• 􀂾 FUTURE CLOSINGS (SALE PENDING): Current pending inventory rather steady with a positive propensity. This implies that closing activity will remain relatively unchanged in the short term. Increase in closings will be incrementally smaller.

The current number of REO properties in San Bernardino County is 7,922. Last month the count was 7,233.  Look for REO type properties to continue to increase.

         
The last report (June) returned -5%. The current result (+8%) suggests a +13% point market speedup. As a reference, the reader should note the January result was -52% implying the market has been in a positive mode at an accelerating rate and has begun to outperform the 2007 market in terms of closed transactions.