Property ValuationIntermediateDelaware Exam

What is 'months of supply' in a Delaware residential real estate market?

AHow many months worth of inventory are listed for sale based on current absorption ratesCorrect
BThe time it takes to close on a property after contract execution
CThe number of months needed to sell a property based on its price tier
DThe time required to satisfy all contingencies in a purchase contract

Why How many months worth of inventory are listed for sale based on current absorption rates Is Correct

Answer A: How many months worth of inventory are listed for sale based on current absorption rates

Months of supply = Active Listings ÷ Monthly Sales Rate. Less than 6 months of supply typically favors sellers; more than 6 months favors buyers.

Exam Tip: Property Valuation

Valuation questions focus on the three approaches to value: sales comparison, cost, and income. Know which approach is best for which property type. The income approach uses cap rate and NOI — memorize these formulas.

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