The absorption rate is a prediction of the number of months it will take to sell the existing inventory based on the sales data of the past 6 months. Most of the perimeter high rise towers have an absorption rate of between 13 and 17 months, while two- Apogee and Ocean House did not even make the list because they did not have any recent sales, and the sales in the remaining three buildings has been so slow lately that it could take up to 8 years to sell all the units that are currently on the market in one of them.
First the math. There were 5 sales at Murano in the past 6 months, which assumes 10 will sell in the next 12 months, and the current 14 that are on the market will be absorbed in just under 17 months. The building with the lowest absorption rate is South Pointe Tower at just under 13 months. The one with the highest rate is the Icon Tower at 8 years follower by Portofino Tower at just over 6 years and Continuum North Tower at just over 4 years. The other 4 Buildings, Murano, Murano Grande, Yacht Club and Continuum South Tower all have between 14 and 17 month of inventory, event though Yacht Club has 36 units on the market and Murano just 14.
What does this mean for you? As a buyer you may have more negotiating room with someone selling a unit in a building with a 6-year supply of inventory than with someone selling in a building with just a 13-month inventory. As a Seller you are probably looking at either waiting it out or adjusting the price to make its purchase more compelling to someone.
Some of the Building issues than contribute to the variation in absorption rate within the same neighborhood have to do with construction-whether its just starting or just finishing, and Special Assessments- whether an assessment is imminent or completed. Accordingly, these things change with time and a building that might be doing well today might not fare so well a year from now. South Pointe and Portofino Towers share the same location yet are selling at dramatically different rates. The same for Continuum North and South Towers They each have 25 units for sale, but one may take 17 months to sell and the other 50.
All of these buildings and the SoFi neighborhood in general are experiencing a Buyer’s Market, one where the inventory supply exceeds 6-9 months. However, as the new construction continues to be absorbed, and there are fewer opportunities to develop in prime locations, I expect this condition will change again, because the three things all these buildings share is Location, Location and Location!