Vacancy rate
The share of time or units a property sits empty and earns no rent. Investors budget a vacancy allowance, often 5% to 10%, when estimating income.
Also called: vacancy, vacancy factor, occupancy rate
Related terms
The money left each month after collecting rent and paying all expenses, including the mortgage. Positive cash flow means the property pays for itself with some left over.
A property's yearly income minus operating expenses, before mortgage payments and income taxes. It is the base number for cap rate and many commercial valuations.
A list of every unit or tenant in a property with rent, lease dates, deposits and other terms. Buyers and lenders use it to verify income and spot lease rollover risk.
Real estate bought to rent to tenants for income rather than to live in. Lenders, insurers and tax rules treat it differently from a primary residence.