Free calculator · Real Estate
Income Waterfall
Calculates effective gross income for a rental property by walking gross potential rent down through vacancy, loss to lease, credit loss, and concessions, then adding other income. Inputs include unit count, market rent, vacancy and credit loss percentages, loss to lease, concessions, and other income, with presets for stabilized, lease-up, and stressed properties.
By Devon Coombs, CPA, MBA · Teaching Professor of Finance, Santa Clara University · Reviewed August 2026
From the author: Devon Coombs, CPA, MBA teaches finance at Santa Clara University and works with corporate teams on practical AI.
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Income Waterfall Calculator
Try an illustrative scenario
This model starts with every unit at market rent for a full year. Vacancy and credit loss are each a percentage of that same gross potential rent. Enter loss to lease, concessions, and other income as annual dollars; count each loss only once. These assumptions are teaching examples, not typical market rates.
Starting from actual contract rents instead? Do not subtract loss to lease again. Refundable deposits, tenant improvements, and leasing commissions do not belong in rent concessions.
Inputs
Waterfall
Gross Potential Rent
100 units × $2,000/mo × 12
$2,400,000
Physical Vacancy
4.0% of GPR
−$96,000
Loss to Lease
Below-market contract rents
−$60,000
Credit Loss
1.5% of GPR
−$36,000
Concessions
Free rent / move-in specials
−$100,000
Other Income
Parking, RUBS, pet rent, storage
+$120,000
Effective Gross Income
Net rental revenue + other income; before expenses
$2,228,000
Revenue Loss
−$292,000
12.2% of GPR
Final EGI
$2,228,000
92.8% of GPR
Per Unit / Month
$1,857
EGI, including other income
EGI is property revenue. Deduct operating expenses to reach NOI; debt service and capital spending come later.
Learn the concept
This calculator comes from the free Real Estate Finance course, where the concept is taught with readings, worked examples, and practice questions.
When to use this measure
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Built by Devon Coombs, CPA, MBA, Teaching Professor of Finance at Santa Clara University.