Author: Ko Wang, James R. Webb, and Suzanne Cannon

Start Page: 107
End Page: 116
Volume: 5
Issue Number: 1
Year: 1990
Publication: Journal of Real Estate Research

Abstract: In performing an absorption analysis for a real estate investment, conventional appraisal approaches assume that space will be absorbed evenly across the market and evenly across the absorption period. These approaches fail to provide an accurate period-by-period absorption schedule for a specific property that reflects the supply and demand conditions of the market as well as specific characteristics of the subject property. The approach proposed in this study provides a simple and explainable model that permits the appraiser to estimate absorption with more accuracy through traditional market comparison techniques and to integrate the analysis of market supply and demand conditions on a period-by-period basis.