Question 1

What is break-even occupancy?

Accepted Answer

It’s the occupancy level at which a property’s income exactly covers its operating expenses and debt service — no profit, no loss. Above it the property is cash-flow positive; below it the owner feeds the deal out of pocket.

Question 2

What is a good break-even occupancy?

Accepted Answer

Lower is better because it’s a bigger safety margin. Many investors like to see break-even in the 70s or low 80s percent so the property can absorb normal vacancy and a tenant or two rolling without going negative. Above ~90% is risky.

Question 3

How do I lower break-even occupancy?

Accepted Answer

Raise rents, cut operating expenses, or reduce debt service (smaller loan, lower rate, longer amortization). Each widens the gap between what you must collect and what the building can produce at full occupancy.

Break-even occupancy calculator.

Want these numbers pressure-tested?