Vacancy Rate (number)
What is it?
Vacancy Rate (number) is a key figure that measures the proportion of the total number of objects in a property or portfolio that are currently empty and not generating rental income. This key figure gives an indication of how efficiently a property is used and how many of the total available objects are not contracted.
In Homepal, vacancy is defined as unlet. Thus, rental properties that are empty, blocked or similar are also included in this value.
How is it calculated?
Number of rental properties without an active agreement with a tenant / Total number of rental properties = %
* Includes all rental properties.
Why is it important to follow?
The following are some important reasons why you should follow the key figure:
Income monitoring: The key figure gives you a direct indication of how much of your property portfolio does not generate rental income for the day. It helps you to monitor and ensure that you are optimizing your income stream from the real estate investments.
Profitability: Empty rental properties can be a burden on your profitability. By following the key figure, you can quickly identify areas where you can improve the occupancy rate and thereby increase your income and profitability.
Early detection of problems: A sudden increase in the number of vacant rental properties can indicate problems in the real estate market, such as reduced demand or competition from other property owners. By monitoring the key figure regularly, you can detect and deal with such problems early.
Effective resource allocation: By knowing which properties have high vacancies, you can focus your resources and efforts on filling those vacancies. It may include marketing, maintenance or pricing optimization.
Financial planning: Vacancy information is critical to making realistic financial plans and budgets for your real estate business. It helps you predict and manage income variations.
Strategic property management: By using the key figure, you can make decisions about the composition and strategy of the property portfolio. You can consider whether it is appropriate to keep or dispose of certain properties based on their occupancy rate.
In conclusion, it is important to follow the KPI as it provides an indication of the health of your property portfolio, affects your revenue stream and gives you the opportunity to take action to improve profitability and tenant satisfaction. It is a central tool for property management and business strategy in the real estate industry.
Created by Homepal
9/15/2023
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