Property Management
What is 'vacancy rate' in property management and why does it matter to investors?
AThe percentage of time a property is occupied; investors prefer higher rates
BThe percentage of rentable space that is unoccupied or not generating income; lower rates indicate stronger performance✓ Correct
CThe rate at which tenants vacate; regulated by Illinois law
DThe amount of time a property can remain vacant before losing its legal occupancy permit
Explanation
Vacancy rate is the percentage of a property's total rentable space that is unoccupied and not generating rental income. Lower vacancy rates indicate strong demand and better income performance. Investors use vacancy rates (along with collection loss) to calculate effective gross income. Market vacancy rates help investors assess the health of a local rental market and potential investment performance.
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