Vacancy Rate

What is Vacancy Rate?

The vacancy rate (or rental vacancy rate) of a property represents;

Vacant units ready to be rented
Units recently made vacant by tenants
Units in need of repair

A Vacancy rate (or rental vacancy rate), is usually presented as a percentage of the empty/vacant/unoccupied/available units in a rental property.
This figure is an important indicator for property owners to know how their investment is performing in the rental market.

FAQs about Vacancy Rate

What does a low vacancy rate mean?

A low vacancy rate tells you that your property is doing well in the rental market. This means that people want to live in your property. A high vacancy rate, on other hand, points to the fact that your property doesn’t do well in the market and that people don’t want to live in your property.

The lower the vacancy rate, the better.

How to calculate vacancy rate?

To calculate the vacancy rate, take the number of vacant units and multiply it by 100, and divide the result by the total number of units.

Let’s take a look at an example;

If a building has 500 units and 50 units are available, the vacancy rate is 10 per cent.

(50×100) ÷100 = 10%

What causes high vacancy rates?

The common reasons for high vacancy rates are:

Exorbitant asking price
Repairs and maintenance are dragged on for an extended period of time
The locality isn’t outfitted with essential amenities and the location is difficult to get to
The area has numerous vacant properties, offering potential tenants more than one option

Learn how to turn your rental property into a winning investment with our 9 tips on reducing your vacancy rates.

Disclaimer: The views, information, or opinions expressed in this blog post are for general information purposes only and should not be relied upon. We have not taken into account specific situations, facts or circumstances, and no part of this blog post constitutes personal financial, legal, or tax advice to you. You should seek tax advice from your accountant, specific to your situation.

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Vacancy Rate

What is Vacancy Rate?

FAQs about Vacancy Rate

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