Real Estate Investing Calculators
Break-even occupancy.
Break-even occupancy is the share of your potential rent you must collect to pay all operating expenses and the mortgage. Enter units, rent, costs and debt payments below to see the break-even percentage, how many units can sit empty and your cushion against expected occupancy. Runs in your browser; nothing is sent or stored.
Your numbers
Result
Fill the form and press Calculate.
Not financial advice. This is an estimating tool built on the numbers you enter. Real estate returns depend on assumptions that can be wrong; check them with a lender, an accountant and local sources before you buy.
Worked example
6 units at $1,200 give potential income of $7,200.00 a month. Operating costs $2,400 plus mortgage $2,800 total $5,200.00. Break-even occupancy = $5,200.00 / $7,200.00 = 72.22%. Against 95% expected occupancy the cushion is 22.78 points, and 1 of 6 units can sit empty before you lose money (cash flow at 95% is $1,640.00 a month).
How it works
Break-even occupancy = (operating expenses + debt service) / gross potential income. Gross potential income = units x rent per unit + other income. Units that can stay empty = (100% - break-even %) x number of units, rounded down. This is our own labelled calculation and not taken from a published source.
Sources and basis
Break-even occupancy is derived directly from the cost and income figures you enter. For the related lender test, Wikipedia’s DSCR article describes debt service coverage as net operating income divided by total debt service.
- Debt service coverage ratio (Wikipedia), opened 2026-10-08.
FAQ
What is break-even occupancy?
The percentage of potential rent you must collect to cover operating expenses and mortgage payments, so cash flow is exactly zero.
How do you calculate break-even occupancy?
Add operating expenses and debt service, then divide by gross potential income: $5,200.00 / $7,200.00 = 72.22% in the example.
What is a good break-even occupancy?
Lower is safer, since it means more vacancy can be absorbed. There is no published threshold; compare it with the vacancy you actually expect in your market.
Should the mortgage be in operating expenses?
No. Enter operating expenses without the mortgage and the mortgage separately. Both are added together for the break-even test.
Does it work for a single rental?
Yes, but with one unit it is all or nothing: the unit is either rented or empty, so use the percentage as a guide to how many months a year it must be rented.