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Tri-Cities Real Estate Market Update: Understanding the Absorption Rate – February 2025

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The absorption rate is a key real estate metric that measures how fast homes are selling in comparison to available inventory. It helps determine whether the market favors buyers or sellers by showing how long it would take for all homes on the market to sell at the current sales pace, assuming no new listings are added.

A high absorption rate (above 20%) suggests a seller’s market, where homes are selling quickly, and inventory is tight. A low absorption rate (below 15%) indicates a buyer’s market, where homes take longer to sell, and inventory is more plentiful.

This analysis looks at West Richland, Richland, Pasco, and Kennewick, comparing absorption rates over the past 12 months, year-to-date (YTD), last full month (January), and the current month (February) to identify market trends.

Absorption Rate Across Different Time Frames

West Richland

  • Past 12 Months: 80% (168 homes sold / 210 homes listed)
  • Year to Date (YTD 2025): 121% (17 homes sold / 14 homes listed)
  • January 2025: 108% (14 homes sold / 13 homes listed)
  • February 2025 (MTD): 300% (3 homes sold / 1 home listed)

Richland

  • Past 12 Months: 81% (548 homes sold / 673 homes listed)
  • Year to Date (YTD 2025): 76% (37 homes sold / 49 homes listed)
  • January 2025: 70% (32 homes sold / 46 homes listed)
  • February 2025 (MTD): 133% (4 homes sold / 3 homes listed)

Pasco

  • Past 12 Months: 78% (541 homes sold / 698 homes listed)
  • Year to Date (YTD 2025): 56% (35 homes sold / 62 homes listed)
  • January 2025: 59% (34 homes sold / 58 homes listed)
  • February 2025 (MTD): 0% (0 homes sold / 4 homes listed)

Kennewick

  • Past 12 Months: 78% (747 homes sold / 958 homes listed)
  • Year to Date (YTD 2025): 64% (50 homes sold / 78 homes listed)
  • January 2025: 66% (48 homes sold / 73 homes listed)
  • February 2025 (MTD): 40% (2 homes sold / 5 homes listed)

What Does This Indicate About the Market?

  1. West Richland is the strongest seller’s market
    • Absorption rates above 100% in YTD, January, and February show that homes are selling faster than new listings are entering the market.
    • With 300% absorption in February, inventory is extremely tight, meaning high competition for buyers and favorable conditions for sellers.
  2. Richland is slightly more balanced but still favors sellers
    • A 133% absorption rate in February and consistent 70-80% rates over time indicate strong demand.
    • The slight decline in YTD and January absorption suggests inventory is increasing, giving buyers a little more flexibility.
  3. Pasco is transitioning into a buyer’s market
    • The drop in absorption rate from 78% (12 months) to 56% (YTD) and 0% in February suggests slowing demand.
    • With no sales recorded yet in February despite four new listings, buyers have more choices and more negotiating power.
  4. Kennewick is also becoming more buyer-friendly
    • The absorption rate has declined from 78% (12 months) to just 40% in February, meaning inventory is rising faster than homes are selling.
    • Buyers have more opportunities here than in West Richland or Richland.

What This Means for Buyers and Sellers

For buyers:

  • West Richland and Richland remain competitive, and homes are selling quickly. If you’re looking in these areas, act fast and come prepared with strong offers.
  • Pasco and Kennewick offer more negotiating room, and sellers may be more willing to adjust pricing or offer concessions.

For sellers:

  • West Richland and Richland are prime markets for selling quickly and competitively. If you’re considering listing, low inventory means strong demand for your home.
  • Kennewick and Pasco sellers may need to price competitively as inventory is growing and absorption is slowing, giving buyers more leverage.

Final Thoughts

Absorption rate trends show West Richland and Richland remain strong seller’s markets, while Pasco and Kennewick are shifting toward buyer-favorable conditions. Inventory shortages are driving competition in some cities, while growing supply in others is giving buyers more control.

If you’re looking to buy in a competitive area, move quickly. If you’re selling in a market where inventory is rising, pricing strategically will be key.

For expert guidance, reach out to ryan@kenmoreteam.com or call 509.987.4544.