Michigan Vacancy Loss Calculator

Vacancy is one of the biggest drags on rental property returns. This calculator shows the true cost of empty units in Michigan — pre-filled with Michigan average rents ($1,400/mo) and vacancy rate (6.8%).

Market

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Property Income(Michigan defaults)

Monthly Rent per Unit

Number of Units

Other Monthly Income(laundry, parking, etc.)

Vacancy Assumptions(Michigan defaults)

Vacancy Rate3.3 unit-months/yr vacant (6.8% avg in MI)

Turnover Cost per Unit(cleaning, repairs, marketing)

Turnovers per Year

Operating Expenses

Total Monthly Expenses(taxes, insurance, maintenance, etc.)

Michigan Market Context

Avg Cap Rate

Median Price

$249K

Property Tax

1.13%

Vacancy Rate

6.8%

Local Factors

-Detroit and Grand Rapids are popular cash-flow markets for out-of-state investors
-Proposal A caps assessment increases at inflation rate for existing owners
-Wide variation between metro markets; rural areas face population decline

Sources

World Population Review – Median Home Price FL Probate Law – Property Tax Rates (ACS Data)The Hartford – Insurance Rates iPropertyManagement – Vacancy Rates

Total Vacancy Cost

$6,070

$506/mo lost

Healthy

Gross Potential Income$67,200

Lost Rent (Vacancy)−$4,570

Turnover Costs−$1,500

Effective Gross Income$62,630

NOI (with vacancy)$19,130

NOI (0% vacancy)$25,200

Vacant Unit-Months/yr3.3

Vacancy Impact on NOI24.1%

Net Income (after vacancy)$19,130

Vacancy Loss$4,570

Turnover Costs$1,500

Operating Expenses$42,000

What does this mean?

A 3–7% vacancy rate is the sweet spot for most rental markets. You're maintaining strong occupancy while likely pricing rents at market rate. Most lenders underwrite in this range.

Understanding Vacancy Loss

Vacancy loss is the income you don't collect when units sit empty between tenants. It's the gap between what a property could earn at full occupancy (Gross Potential Rent) and what it actually collects.

Vacancy Loss = Gross Potential Rent x Vacancy Rate

What vacancy rate should you use? Most lenders underwrite 5-8% for stabilized multifamily. Michigan averages around 6.8%. Your actual rate depends on local market conditions, property condition, and management quality.

Keep running the numbers

One calculator rarely tells the whole story.

Vacancy eats into everything in Michigan. See the full impact on your returns.

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