Definition

In real estate, the number of units in a building that have been rented out as compared to the total number of units in the building. Occupancy rates are important to real estate investors because they provide an indication of anticipated cash flows for instance, occupancy rate of 10% indicates that only 1/10th of available space has been used. Conversely, the vacancy rate is the number of units in a building that are not rented out as compared to the total number of units in the building.