Calculate your rental property vacancy rate, occupancy rate, and annual income loss from vacancy.
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The Chen family is buying a $340,000 home in Columbus, Ohio. Combined income $115,000, 10% down payment, 30-year fixed at 7.125%.
Takeaway: Columbus/Franklin County averages are the reference baseline. Property tax rates and insurance premiums shift significantly by ZIP code and HOA status. Plug your actual numbers in above.
We default to state-average millage rates. County and municipal rates vary 40%+ within a single state. Ohio ranges from 0.8% (rural counties) to 2.4% (Cuyahoga/Cleveland area). Always cross-check your specific county assessor's published effective rate.
Property Tax by StateHomeowner association fees add $100-$800/month in condos and planned communities. Condos in urban markets often run $400-$700/month. If your property has HOA, add it manually to any payment estimate — it directly affects your debt-to-income ratio for loan qualification.
HOA Fee CalculatorClosing costs typically run 2-5% of the loan amount — around $6,000-$15,000 on a $300K home. Lender fees, title insurance, escrow, and prepaid taxes add up fast. These are due at closing in cash, not rolled into the mortgage by default.
Closing Costs CalculatorPrivate mortgage insurance (PMI) costs 0.5-1.5% of the loan annually until you reach 20% equity. On a $300K loan at 1%, that's $250/month. PMI cancels automatically at 78% LTV under federal law — but you can request removal at 80%.
National home price appreciation has averaged ~4% annually since 1968, but markets diverge dramatically. Sun Belt metros averaged 10%+ during 2020-2022; coastal markets often lag the national average during correction cycles. Local supply constraints are the main driver.
If you've lived in the home 2 of the last 5 years, you can exclude $250K (single) or $500K (married) of gain from federal capital gains tax. Many calculators show gross profit without applying this exclusion. Relevant when projecting sale proceeds.
Home Sale Capital Gains CalculatorBased on your inputs
91.8% occupancy rate
| Vacancy Rate | 8.2% |
|---|---|
| Occupancy Rate | 91.8% |
| Annual Gross (100% occupied) | $24,000 |
| Annual Vacancy Loss | -$2,000 |
| Effective Gross Income | $22,027 |
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A vacancy rate of 5–8% is typically used for underwriting. Rates below 5% indicate a very tight market. Above 10% suggests oversupply or management issues.
Vacancy Rate = (Vacant Units / Total Units) × 100. For a single property over time: (Days Vacant / 365) × 100.
U.S. national residential vacancy rate typically runs 5–7%. Rates vary significantly by metro area — some Sun Belt cities are 3–4%, others 8–12%.
Higher vacancy reduces effective gross income, which reduces NOI and therefore lowers cap rate. A 10% vacancy on a $2,000/month property costs $2,400/year.
Price rent competitively, maintain the property well, respond quickly to maintenance requests, screen tenants thoroughly, and offer lease renewal incentives. Start marketing 60 days before lease expiration. Properties in good condition with responsive landlords have the lowest turnover.
Physical vacancy means no tenant occupies the unit. Economic vacancy includes physical vacancy plus rent concessions, bad debt, and below-market rents. A property can be 100% physically occupied but still have 5-10% economic vacancy from discounts and nonpayment.
Each turnover costs $2,000-$5,000 including cleaning ($200-$500), repairs ($500-$2,000), marketing ($100-$300), screening ($50-$100), and lost rent during vacancy (average 30-45 days). Retaining good tenants is significantly cheaper than finding new ones.
Use 5-8% vacancy for stable single-family rentals. Use 8-10% for multifamily in average markets. Student housing may need 10-15% for summer vacancy. Always check local market vacancy rates and use the higher of market average or 5% minimum in your projections.
Vacancy is highest in winter months (November-February) when fewer tenants move. Summer has the highest demand due to school schedules and moving season. Time lease expirations for spring or summer to minimize vacancy between tenants and maximize applicant quality.
Vacancy Rate = (Days Vacant / 365) × 100
Or: (Vacant Units / Total Units) × 100
Effective Gross = Annual Gross × (1 − Vacancy Rate)
Every formula on this page traces to a federal agency, central bank, or peer-reviewed institution. We cite the rule-makers, not secondhand blogs.
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Calculations are for educational purposes only. Consult a qualified financial advisor for personalized advice.