Monday Morning Coffee

Hello all,

“Absorption Rates”

This is a timely subject that we need to visit every now and then. Absorption rates is a calculation to determine how much inventory is on the market and how many months of supply there are. A 6 month supply of inventory represents a equal balance between a buyers and sellers market. Mark mentioned that the spring market really starts in mid January, the main reasons is the buyers are getting geared up and the inventory is very low from the winter supply. Being able to calculate Adsorption rates will help you show your clients the need to get on the market before the spring rush. Normally you would calculate the rate for smaller areas but I will use two zip codes as an example.

20874:

Active listings = 260

Sold properties last 12 months = 709

Sold properties (709) divided by months (12) = 59

Take the active listings (260) divided by the number of sales per month (59) to get the months of inventory.

260 /59 = 4.4

So in this case if no further inventory came on the market we would be out of homes in 4.4 months, slight buyers market.

20854:

Active listings = 284

Sold Properties last 12 months = 512

Sales per month = 43

284/43 = 6.6

6.6 months of inventory, slight sellers market.

Enjoy the coffee,

Joe

INSPIRATION FOR TODAY:

"A man's reputation is the opinion people have of him; his character is what he really is."

- Jack Miner, conservationist (1865-1944)

HOW'S YOUR CREDIT?

Ever hear someone say, "I have good credit"?  They are probably referring to their credit "rating" - a score bestowed upon them by creditors, banks or rating agencies.  Simply stating, "I have good credit" changes nothing, nor does the statement merit the attention of creditors.  Credit can only be given by others for service to them, i.e. paying them on time.

So, credit is the result of serving others - in many ways.  You cannot claim education, victory, experience, success, reputation, or a suave demeanor.  Each of these is a gift from others, as a result of your service to them.  Friends recognize your courage as a result of your being cool under pressure.  Your success is recognized by others only once you have served them well.  Knowledge of your career field is recognized by others only after it's been applied to situations in the form of more service.

In the accounting world of income and expense, a debit is something paid out, while a credit is something received.  Thus all credits are received from others - not by our own making.  The debits - what we pay out - are our efforts, persistence, and service.  How they are rated is not under our control, but is determined by those served.

Without service, there are few rewards.  Yet, you've seen those who insist on getting more attention than they deserve.  They feel they're being short-changed, that they are not appreciated, that they are always the victim.  If you look more closely at their contributions, you are also likely to see the dearth of service they are offering.

With service, credit follows.  It may be subtle or quite visible - but it always follows.  Concentrate on what you have to offer and forget the rewards.  Those who are served will pick up the tab!