Property Management
In Hawaii, what is a 'vacancy factor' in property management budgeting?
AA. The cost of decorating vacant units
BB. An allowance for expected income loss from unrented units and non-payment of rent✓ Correct
CC. The time it takes to process rental applications
DD. The cost of security personnel for vacant properties
Explanation
The vacancy factor (and credit loss allowance) accounts for expected income loss from vacant units and non-paying tenants when calculating effective gross income for a rental property.
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