What’s in a rent roll? 

A rent roll is a document that typically details information about each unit at a multifamily property, including: 

• Number of bedrooms and bathrooms
• Square footage
• Occupancy status (whether vacant or occupied)
• Renter’s name
• Actual monthly rent, or potential rent if vacant
• Any additional rent or fees (such as parking or pet fees)
• Renter’s move-in date
• Renter’s lease term and expiration date
• Whether the unit is subject to rent regulations and/or benefits from rent subsidies
  

A rent roll may also include information on any past-due rent or upcoming rent adjustments. 

Analyzing a rent roll

When all units’ rents and fees are totaled, a rent roll shows how much income a property is generating each month. Here are additional factors to help determine whether the property can continue producing that income.

How do current rents compare to market rates? 

Below-market rents can be a positive sign because there’s potential for cash flow improvement if the owner can bring rents closer to market levels. Rent increases may be limited by state or local rent regulations. 

Properties with below-market rents also typically fare better in economic downturns, as renters are less likely to move out seeking more affordable options. Above-market rents, on the other hand, could raise concerns about whether the property’s cash flow is sustainable throughout the real estate cycle, particularly during times of economic volatility. 

When evaluating potential investment properties, requesting leases can help verify rents listed on the rent roll and show whether residents received concessions. 

What’s the vacancy rate? 

An investor who’s considering purchasing a property with an elevated vacancy rate should find out why occupancy is low and how they could address any issues. For instance, maybe rents are too high, limiting demand. On the other hand, if units are intentionally vacant due to renovations, it could be a positive sign. 

How long do renters stay? 

Move-in dates can offer insight into the property’s level of turnover. Residents who’ve been living at a property for a few years tend to stick around, especially if the unit has below-market rent.

Properties that attract long-term renters can be desirable. Low turnover reduces costs associated with vacancies, such as marketing units and fixing them up for new renters, in addition to forgone rent.  

However, the situation can be different if a property has long-term renters in units subject to rent regulations paying significantly below-market rents. Consider how local rent regulations may affect your ability to adjust rents.

When do leases expire?

If leases are expiring soon, there’s a risk vacancy will increase, temporarily reducing rental income. A buyer in that situation could consider having the seller renew leases or prepare for potential turnover. 

Does the unit mix match the market’s renter pool? 

Consider whether the property’s unit mix appeals to the local renter market. An apartment building with mostly one-bedroom units may do well in a downtown area that appeals to working professionals who like to live alone. But that building could be less attractive in a college town with students who prefer living with roommates or a neighborhood with mostly families who need more space.

Using rent rolls in rental management 

An accurate rent roll can be a useful tool as it consolidates information on rent payments and lease terms in one place. A property owner or manager can use it to check whether renters are up to date on payments and ensure they’re paying the correct amounts. It also can help track leases nearing expiration, so owners and managers know when to ask residents to sign a new lease or begin marketing the unit.