Glossary definition
Void Period
The period during which a property stands empty and produces no rental income, whether between lettings or prior to first occupation. Void periods directly impact investment returns and a lender's assessment of debt serviceability, particularly on commercial mortgage applications.
Definition
The period during which a property stands empty and produces no rental income, whether between lettings or prior to first occupation. Void periods directly impact investment returns and a lender's assessment of debt serviceability, particularly on commercial mortgage applications. Lenders typically stress-test their calculations by assuming void periods of three to six months to ensure the borrower can service the debt during unlet periods.
See also
Closely related terms.
Rack Rent
The full open market rental value of a property if let on normal commercial terms without any premium, rent-free period, or discount.
Gross Yield
The annual rental income from a property expressed as a percentage of its purchase price or market value, before deducting any expenses.
Net Yield
The annual rental income from a property expressed as a percentage of its purchase price or market value, after deducting all operating expenses such as management fees, maintenance, insurance, and void periods.
ICR (Interest Cover Ratio)
A measure of how comfortably a property's rental income covers the interest payments on a loan, calculated as annual rental income divided by annual interest costs.
DSCR (Debt Service Coverage Ratio)
A financial metric that measures the ability of a property's net operating income to cover its annual debt service obligations, calculated as net operating income divided by total debt service.
Further reading
Guides that touch this term.
Guide
Commercial Mortgages in the UK: A Complete Guide
Everything you need to know about commercial mortgages in the UK - from eligibility criteria and rental coverage ratios to how lenders value multi-let properties and what lease length matters.
4 min read readReadGuide
RICS Red Book Valuations for Development: What Lenders Require
A comprehensive guide to RICS Red Book valuations in development finance, covering what lenders require, how valuations are structured, and how to ensure your scheme is accurately assessed.
11 min read readReadGuide
UK Development Finance Market 2026: Rates, Trends and Outlook
A comprehensive overview of the UK development finance market in 2026, covering current interest rates, lender appetite, emerging trends, and what developers should expect over the coming 12 months.
9 min read readRead
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