A rent survey indicates that one-bedroom units have a higher occupancy than two-bedroom units. What should the appraisal likely project for two-bedroom units?

When analyzing the occupancy levels indicated by a rent survey, it is important to consider the implications of the findings on the rental income potential for different unit types. If the survey shows that one-bedroom units have a higher occupancy rate compared to two-bedroom units, it suggests that there is a stronger demand for the smaller units in the market.

In this context, it is reasonable to project that two-bedroom units will experience a higher vacancy factor. This projection stems from the inference that if fewer tenants are choosing to occupy two-bedroom units, the likelihood of those units remaining vacant is increased. A higher vacancy factor for two-bedroom units indicates that they may not be as desirable or in demand as one-bedroom units, which could affect their rental value and investment appeal.

This reasoning aligns with the principles of supply and demand in the real estate market. When one type of unit is more popular with renters, it will typically see lower vacancy rates, while the less popular unit type will likely experience higher vacancy rates due to reduced interest from potential tenants. Thus, projecting a higher vacancy factor for two-bedroom units in light of the survey results is consistent with market behavior and supports effective appraisal practice.