How to Calculate Prorated Rent

Written on July 11, 2014 by , updated on July 27, 2015

Prorated Rent

One of the most common questions that I receive from other landlords is “How do I calculate prorated rent?”

What is Prorated Rent?

Prorated rent is the amount of money a landlord charges a tenant when he/she is only occupying a unit for a partial term (month, week, etc).

Most commonly, it’s when the  landlord only charges the tenant for the number of days he/she occupies a unit, although the price is based on a monthly rate, not a daily rental rate – as daily rentals are often more expensive.

Why Prorate?

It’s the only way to be fair.

Prorating rent by the day is the most practical when a tenant moves in or out in the middle of the month, or is subletting to someone else.

For example, a tenant wants to move-in on July 17, for a lease duration of approx. 6.5 months. The landlord would charge a prorated amount from July 17th to July 31 (15 days), and then charge the full monthly rent amount on the first of every month thereafter.

Note: Cozy prorates the first month’s rent automatically, as part of our free online rent payment service.

Two Methods

There are two popular methods of calculating prorated rent and both are quite simple. One method is to prorate rent based on the number of days in the current month, and the other is to calculate rent based on the yearly rent total divided by days in the year.

Lets examine both methods:

1. Prorate by the number of days in the Year

Popular to some, this is technically the most accurate if dealing with a year-long lease. Although, I’ve found that this method typically confuses tenants, and I have to explain it multiple times.

( ( Mo. rent * # months in year ) / # of days in year ) * # of days tenant is paying for = Prorated Rent

Using a move-in date of July 17, and a monthly rent of $1,500, the equation would be as such:

( ( $1,500 * 12 ) / 365 ) * 15 = $739.73

If the current month has 31 days, a yearly prorated calculation will return a higher yield than a monthly calculation. However, if the current month has 30 days or less, the monthly calculation will be higher.

In all honesty, the extra cash is never worth the time it takes to validate the equation to the tenant, and in the end, they still tend to think I’m nickel-and-diming them – especially if their lease is not for a full year.

At this stage in the lease process, they probably haven’t signed a lease yet, so I’d rather go with the prorating method that leaves the best possible first impression.

2. Prorate by the number of days in the Month

This is my preferred method of prorating rent, and is easier to calculate.

( Mo. rent / # days in Mo. ) * # of days renter is paying for = Prorated Rent

Using a move-in date of July 17, and a monthly rent of $1,500, the equation would be as such:

( $1,500 / 31 ) * 15 = $725.80

The benefits of calculating prorated rent by the month are:

Accuracy:

If you’ve ever rented a unit month-to-month, you know that not all months are created equal.

I can charge a lot more for a monthly rental in July than I can in January. It’s all about supply and demand. Rent in July may be $1,500, but market rate for the same unit in January may only be $1,200.

Easy to Understand:

The majority of my tenants think in the “here and now”.

Many of them are young, just out of college, and live paycheck to paycheck. They are not typically familiar with thinking long-term or big picture.

Even if it’s cheaper for them if I prorate based on the number of days in a year, they feel more comfortable prorating it by the month. It makes them feel like they are only paying for what they use – which is how they live their day-to-day lives.

What about You?

I’d love to hear your stories about prorating rent.

Which method do you use and why? Answer in the comments below.

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212 CommentsLeave a Comment

  • miahley

    my landlord gonna sale his house and he get us 60 day notice staring mid april. which they want us to move out by 6/15. by may 8 we found a house with the same property management. we sign contracts with them in 5/22. they told us we do not need a letter notice, because they already know we gonna move out. by june 1st. I now just got a letter why I dont get my deposit back, because they charge me porated rent from June 1-15. and they charge me like $400 cleaning. which by law. i leave the house as clean as when I moved in. which I did. now I feel this rental place is target me for free money.

  • Melissa

    What if a lease says N/A under prorated rent?

    The scenario is we pay 1st month in full due July 1. Lease states starts 6/25 and we move in on 6/25. There’s nothing in the lease indicating rent for 6/25 to 6/30.

    Would anyone expect to be paying a pro rated amount or would the expectation be they waived the rent for those extra days?

  • James B Murphy

    If my prorated rent started on the day I moved in, say August 15th and we stayed for a full year (12mos)..does that mean my lease started on August 15th?

    • Susan Jones

      Ok my lease is up. Got pro rated rent due. For Dec and owner don’t want to have another lease agreement with me as tentat. I paid rent every month. Never late. So if i don’t pay the pro rated rent. How long do i have before i get court notice to get out

  • Sherry Dilligard

    I just paid deposits on an apartment .the paper i received states that rent is prorated from july 3rd to the 31st .then states no rent due til sept 1st im confused

  • Novellette

    So I been living in my house for a year in like 4 months in my rent was 550 when I first move in after I couple of months my sister move in with me in the landlord wen up on the rent to 600 but now she wants my extra guess to move out in she offer to take the rent down to 525 a month but I wanted to change the due date for it to be better for me which it was due on the 1st every month but I want her to change it to the 16th every month in she said seen she change the due date she has to prorate me for next month is that true can she do that

  • Abalena Garcia

    i’m leaving out of the house i rented the landlord wants me to pay full month rent which is $700 ?

    if i am leaving on Aug 10th i’m leaving in 1 week and 3 days? why am i paying the full month? how
    much should i be paying ?

  • Abalena Garcia

    i’m leaving out of the house i rented from the landlord wants me to pay full month rent which is $700 ?

    if i am leaving on Aug 10th i’m leaving in 1 week and 3 days? why am i paying the full month? how
    much should i be paying ?

  • Sandra R Smith

    When a landlord says they are waving the first month rent for some work you done on the house. What exactly does wave a month’s sent mean?

  • Trisha

    How much is it daily , prorated from $500 a month from today’s date would be how much today is 8-10-18 till the 8-31-18 is it like $13 dollars a day

  • Dontrell Jones

    Jus so I’m clear. If I move in in the middle of the month the first months rent should be prorated or is it the following month?

  • Anna shkara

    Ok I moved in half a month and lease signed says prorated rent and payed extra security deposit also. So my rent is $535 and I payed $735 for security he asked then $265 for protected lease says but landowner saying I owe $197 for that month. So I’m confused for that month moved. Do I owe that money. It doesn’t say that in lease or receipts. It say the security and pro rented rent. Payed in money order two so won’t be confused and he wrote the numbers from money orders and kept receit part to. So do I owe anything for that money well $197 saying and charged.

  • Toni

    I rent a hotel room for 3 days. I check in on November 3 and check out November 6 I’m billed for 3 days.

    I rent a car for 5 days. I take possession of the car October 5 and return it October 10th, I’m billed for 5 days.

    My landlord says in both cases I owe an extra day. Why? Do landlords get special privileges.? He says he’s entitled to the day I move in (11/3) as day 1; (11/4) is day 2; 11/5 is day 3 and day 6 is the additional day I owe. Really?

  • Adrienne V. Moore

    I still don’t get how you came to calculate a prorated monthly rent from example you gave above.
    My tenant is moving in Decem 9 and leaving on March 12.
    I would like to pro rate her rent for the month. of December and March.
    Thanks.
    Adrienne Moore

  • Calvin Wright

    So i moved in on November 23rd…. when is my rent due again says first of every month but havent been here full mont. Im confused

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