Real Estate Glossary

The following are some common real estate terms you may run across during the process of buying or selling your home.

Allowance for vacancy and income loss

An allowance used on pro-forma or profit-and-loss projections for income properties. You subtract an allowance for vacancy from gross income to decide net effective income (income before expenses). An investor cannot use rental property that is 100\% occupied. Depending on the market area, the vacancy allowance for income properties such as apartments is usually from 5\% to 10\% of the gross rental.

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