Most rental property underwriting accounts for vacancy as a percentage — 5%, 8%, maybe 10% of gross rent set aside for the months a unit sits empty. Fewer investors budget for what actually happens during that vacancy: the cleaning, the paint, the flooring patch, the re-key, the marketing spend, and the leasing time that turns "tenant moved out" into "tenant moved in."
That gap between move-out and move-in is a turn. And a turn costs real money whether or not you planned for it.
Why It Matters
Turnover cost is easy to underestimate because it doesn't show up as one bill. It shows up as a dozen smaller ones spread across a few weeks — a cleaning crew, a can of paint, a locksmith, a listing fee, a leasing commission — and each one feels small enough to absorb without tracking. Added up, they rarely are.
Industry data for 2026 puts the average full turnover — lost rent, cleaning, repairs, marketing, and leasing costs combined — in the $2,000 to $5,000 range for a standard unit in reasonable condition, with the physical make-ready alone (paint, flooring, punch-list repairs) typically running $1,500 to $3,500. Units left in rough shape, or requiring a full flooring replacement, can push a single turn to $8,000–$15,000. Rising labor costs and longer leasing cycles are pushing these numbers up further this year, not down.
If you're only budgeting vacancy as lost rent, you're missing the second half of the expense — and that second half is often the larger one.
What Actually Goes Into a Turn
A turnover budget should account for every category below, even on units that "just need a quick clean":
- Deep cleaning — carpets, appliances, cabinets, bathrooms. Even well-kept units need this between tenants.
- Paint — touch-ups at minimum, full repaint if walls show wear, scuffs, or tenant modifications.
- Flooring — the single biggest swing line. Patch-and-clean is inexpensive; full replacement of carpet or LVP is not.
- Repairs and punch-list items — anything deferred during the tenancy that wasn't urgent enough for a mid-lease work order.
- Re-keying or lock changes — a security basic, not optional.
- Marketing and listing costs — photos, listing syndication, and the time a unit sits vacant while it's shown.
- Leasing commission — if you use a property manager or leasing agent, this is typically a flat fee or a percentage of the first month's rent.
- Lost rent during the vacancy window — the number most investors already track, but it's only one line among several.
Treating these as one lump "turnover cost" instead of tracking them individually makes it much harder to spot which category is actually driving your expense — and which tenants, units, or lease terms are costing you the most to turn.
Turnover Cost vs. Capital Expenditure
Not every dollar spent during a turn belongs in the same bucket. A repaint and a deep clean are ordinary turnover expenses — recurring, deductible in the year incurred, and directly tied to re-leasing the unit. A full kitchen replacement or a new roof discovered mid-turn is a capital expenditure — a longer-lived improvement that gets depreciated, not expensed.
Mixing the two makes your per-unit profitability numbers unreliable. If a $12,000 flooring replacement gets logged the same way as a $200 paint touch-up, you'll misread that unit's operating performance for the year it happened — and undercount what your reserve fund actually needs to cover for the next turn.
Common Mistakes
Budgeting vacancy as lost rent only. Lost rent is real, but it's usually the smaller half of what a turn actually costs.
Not tracking turnover costs per unit. Without a per-unit history, you can't tell if a specific property has an unusually expensive turnover pattern — worn flooring, an outdated kitchen, a location that takes longer to re-lease — until it's cost you several cycles.
Treating every turn the same. A tenant who leaves a unit spotless after three years costs far less to turn than one who leaves after eight months with damage beyond normal wear. Security deposits should cover the gap, but they rarely cover all of it.
Skipping a reserve for turnover specifically. Many investors keep a general repair reserve but don't size it against their actual turnover frequency and average turn cost — so a turn becomes a cash flow surprise instead of a planned expense.
Letting a unit sit vacant to save money on rehab. Delaying the make-ready to spread out the cost usually costs more in extended vacancy than it saves in repairs.
Best Practices
- Track every turnover expense by category (cleaning, paint, flooring, repairs, marketing, commission) and by unit, not as a single lump sum — the pattern across turns tells you where your real costs are.
- Build a per-unit turnover reserve based on your actual historical average, not a generic industry number — a unit with older flooring or finishes needs a bigger reserve than one recently renovated.
- Separate ordinary turnover repairs from capital improvements in your records so your operating expenses and your depreciation schedule both stay accurate.
- Move fast. A unit that sits vacant an extra two weeks while a punch list gets scheduled piecemeal usually costs more in lost rent than it saves in contractor coordination.
- Review your turnover cost trend at least annually — rising average turn costs are often the earliest signal that a property's finishes are due for a planned upgrade rather than another round of patch repairs.
Turnover isn't an exception to your operating budget — it's a recurring, predictable cost of running rental property, the same as insurance or property taxes. The investors who treat it that way, and track it accordingly, are the ones who aren't blindsided every time a lease ends.