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Absorption

An estimate of new occupancy determined by the sale of available homes in a specific real estate market during a given time period.

Example:  A total of 1,000 new apartments are available for sale on the market. During the year, 50 homes have been sold; an equal number may have come on to the market, but this serves only to keep the baseline constant.  The annual absorption rate is 5% (50 / 1,000).