What does Effective Rental Income mean?

Effective rental income is a measure of the total rent that is actually collected from a property, after deducting any vacancy or other losses. Effective rental income is often used in real estate investment analysis, and it is a key factor in determining the financial performance of a rental property. Effective rental income is calculated by subtracting vacancy and other losses from the gross rental income of a property, and it may be used to compare the income potential of different properties or to assess the feasibility of a proposed investment.

Related Terms

Grantor Passive Loss Lock-In Effective Gross Income Sweat Equity Historic Structure Chimney Back Seller Broker Real Estate Broker Fair Housing Act Infill Housing Density Test Repayment Plan Maintenance & Emergency Repairs Condominium Conversion Appraisal Equifax Real Estate Investment Trusts (REITs)