What term describes the portion of income that is not collected due to vacancies?

The term that refers to the portion of income not collected due to vacancies is collection loss. This concept is central to real estate appraisal and property management, as it highlights the potential revenue that could have been generated if all available rental units were occupied. Collection loss represents a direct financial impact on the income statement of a property, affecting overall cash flow and profitability.

While the vacancy rate refers to the percentage of unoccupied rental units, it does not quantify the actual income lost. Effective income is the total potential income minus any losses, including collection loss, but does not specifically identify the source of income reduction. Operating loss encompasses various expenses and other issues that reduce net income and can include factors beyond just vacancies. Therefore, collection loss is the most precise term for this specific financial metric.