Loss Of Rent Calculator
What Is Loss of Rent?
Loss of rent is the rental income a landlord misses out on when a property stops producing rent. The two most common causes are vacancy (no tenant, no rent) and tenant default (a tenant who stops paying). It is different from loss to lease, which is the gap between market rent and the rent you actually collect on occupied units. Both hurt cash flow, but they are measured differently, so this calculator handles each one in its own mode.
How to Use This Calculator
Pick the mode that matches your situation:
Vacancy duration mode
Enter the monthly rent per unit, how many months the unit sat empty (decimals are fine, so 6 weeks is 1.5), and the number of units. The tool computes the total lost rent with the formula:
Loss of rent = monthly rent \u00d7 months vacant \u00d7 number of units
Vacancy rate mode
Enter the monthly rent and the expected vacancy rate (5% is a common planning figure). The tool computes the monthly and annual vacancy loss plus the effective rent you actually collect:
Monthly loss = monthly rent \u00d7 vacancy rate \u00d7 units
Loss to lease mode
Enter the current market rent and the rent your tenants actually pay. The tool shows how much income you leave on the table by renting below market:
Loss to lease = (market rent \u2212 actual rent) \u00d7 units
Worked Example
A landlord owns a duplex where each unit rents for $1,800. One unit sat empty for 6 weeks (1.5 months):
- Monthly rent per unit: $1,800
- Months vacant: 1.5, units affected: 1
- Total loss = $1,800 \u00d7 1.5 \u00d7 1 = $2,700
- Daily bleed rate = $1,800 \u00f7 30 = $60 per day
- That vacancy ate 6.25% of the property's $43,200 annual rent potential
Seeing the daily number is the point: every extra empty week costs this landlord $420.
Why Vacancy Loss Matters More Than It Looks
A single month of vacancy on a $1,500 unit does not just cost $1,500. Turnover usually adds cleaning, repairs, advertising, and sometimes an eviction or leasing fee on top. Investors also judge a property by its effective gross income (gross potential rent minus vacancy and collection losses), so chronic vacancy directly lowers appraised value. Tracking the loss per day keeps the urgency visible while a unit sits empty.
Loss of Rent Insurance
Many landlord insurance policies include loss of rent (sometimes called fair rental value) coverage, which pays the rent you lose when a covered peril, like fire or storm damage, makes the property uninhabitable. Insurers typically ask for a documented calculation of the lost income, which is exactly what this tool produces. Copy your results and attach them to the claim. Note that standard policies do not cover vacancy between tenants or a tenant who simply stops paying; that risk is managed with screening, reserves, and lease terms.
Frequently Asked Questions
What is the formula for loss of rent?
For vacancy: monthly rent \u00d7 months vacant \u00d7 number of units. For a vacancy rate: monthly rent \u00d7 vacancy rate \u00d7 units gives the monthly loss; multiply by 12 for the annual figure.
What is a normal vacancy rate for rental property?
Many investors underwrite 5% to 10% vacancy, roughly 2 to 5 empty weeks per year per unit. Tight urban markets can run lower, while single-family rentals in soft markets often run higher. Use your own trailing 12-month history when you have it.
Is loss of rent tax deductible?
You generally cannot deduct rent you never received, because it was never income. But the expenses tied to the vacancy, like advertising, repairs, and utilities you paid while the unit was empty, are usually deductible rental expenses. Confirm with a tax professional.
What is the difference between loss of rent and loss to lease?
Loss of rent is income lost because a unit produces nothing (vacant or non-paying tenant). Loss to lease is income lost because an occupied unit rents below the current market rate. This calculator measures both, in separate modes.
How do I reduce vacancy loss?
Price to the market (not above it), respond to inquiries fast, keep turnover units rent-ready, renew good tenants early with modest increases, and track your days-vacant per turnover so the trend stays visible.