Hi to all~!
I know i’m gonna sound silly asking this but I’m just a newbie starting out.
What does vacancy rate mean? I mean when they say a vacancy rate in the city is 7%, i know that’s its not likely to be tenated often but what does it really mean?
Does it mean that 7% of the time the property is empty and 93% of the time its occupied? I’m really confused about vacancy rate. Please help~!
Thxs~!
Perry
It means that at any one time 7% of rental properties are vacant.
Yours may never be vacant or may be vacant for longer than 7% of the time.
Cheers,
Simon Macks
Mortgage Hunter
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
i use another vacancy rate of my own.
when i work out if i can afford a property or not, i work my rental income out on a vacancy rate of 4 weeks a year that it may be vacant, so that if you do have a short period vacant, you can still afford it.
it’s always safer, than assuming your property will be fully rented all year every year.
Thxs Hunter and Investron,
Your answers were really helpful and straight to the point. Thxs Investron, i now know how to take into account vacancy periods when doing my calculations.Thanks guys.
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