What Is a Vacancy Rate? Definition, What They Mean and Calculation

What Is a Vacancy Rate? The vacancy rate is the percentage of all available units in a rental property, such as a hotel or apartment complex, that are vacant or unoccupied at a particular time. A vacancy rate is the opposite of the occupancy rate, which is the percentage of units in a rental property that are occupied. High vacancy rates indicate that a property is not renting well whilelow vacancy rates can point to strong rental sales. In addition to being used for real estate analysis, vacancy rates can also be applied to the employment sector. Understanding Vacancy Rates Vacancy rates are a very important determinant for property owners because they tell them how their buildings are performing when compared to the area's vacancy rate. These rates are also economic indicators as they paint a portrait of the broad market conditions. In real estate, the vacancy ratemost often represents units that are vacant and ready to be rented, units that have been turned off upon the exit of a te...