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by Ben Luxon April 30, 2019 2 min read

Try Our Free Prorate Calculator!



What is Prorated Rent?

Prorated rent is simply the way to work out how much rent is due when a tenant hasn’t been in the lodgings for the full billing cycle. For example, they move into your property on the 14th of the month but the billing cycle begins on the 1st of the month. You have to work out how much rent they owe for the 17 days remaining in the billing cycle.

Why do you need to Prorate Rent?

You will need to calculate prorated rent to accurately reflect the amount of time your tenant has actually stayed in your property.

Manually Calculating Prorate Rent

While it’s easier to simply use a prorate calculator (scroll down to use the one on our page) you can use some basic math to manually determine prorated rent. We have included these equations below to help give you an idea as to how calculating prorated rent actually works. Knowing how to calculate it manually will allow you to check any online calculator you might use.

The most basic method is to calculate rental costs per day. Once you’ve worked that out you multiply by the remaining days left in the billing cycle.

  1. Monthly Rent / Days of Month = Daily Rate
  2. Days of Month - Date tenant moves in + move-in day = Days left in Billing Cycle
  3. Daily Rate * Days left in Billing Cycle = Prorated Rent

Example:

  • Monthly Rent $800.
  • 30 Days in the billing month.
  • The billing cycle starts on the 1st.
  • Tenant moves in on the 7th.
  1. 800 /30 = $26.67
  2. 30 - 7 + 1 (move in day) = 24
  3. $26.67*24 = $640.08

The Prorated rent for them in this example then would be $640.08.

Calculate prorated rent

Impressive stuff...

A Few More Things To Consider

  • Is it a leap year?
A shorter month means a larger daily rate.
  • Billing Date
eg. is it the 1st?
  • Does the rent span across months?
Work the exact count of days for the billing cycle.
  • Are they paying more than 1 month at a time?
Different months will have different daily rates.

Ben Luxon

"Ben is a co-founder, author and real estate enthusiast. His interest in all things entrepreneurial has led him to work with real estate professionals all over the world, distilling their knowledge into articles and Ebooks. His love of travelling has taken him to over 10 countries in the last year, where he has sampled the craft beer of them all."



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