What is prorated rent and how do you calculate it?
You’ve signed a lease and you’re all set to move in—but it’s the middle of the month. How much will your first month’s rent be, when you only live in the apartment for a fraction of it?
That’s where prorated rent comes in. Prorated rent allows you to pay for the partial month that doesn’t fit nicely into a monthly billing cycle.
Table of contentsWhen to ask for prorated rentHow to calculate prorated rent
When to ask for prorated rent
If you won’t be living in an apartment for a full calendar month due to your move in or move out date, you’ll want to ask for prorated rent.
First month of a lease
If your move-in date for a new apartment is in the middle of the month, you’ll want to ask your new landlord (in writing!) to prorate your rent for the first month. Landlords are incentivized to do this because it’s easier for them to collect rent payments on the same day each month for all tenants, rather than starting each lease and the subsequent rent collection on the different days each tenant moves in.
Last month of a lease
There is no national law that requires landlords to prorate your rent. Oftentimes, it can be harder to negotiate prorated rent on the back end, since you already committed to paying a certain amount each month for the duration of your rental period. If you’re in a month-to-month lease and you want to be able to move out on a date other than the 1st of the month, try asking your landlord politely in writing to add a policy about that into your lease before you sign. Review the existing lease carefully, as some leases have clauses prohibiting prorated rent.
How to calculate prorated rent
There are two ways to calculate prorated rent: by the number of days in a month or by the number of days in a year. Which one you choose might be up to the landlord, as well as what kind of lease agreement comes with the place—month-to-month or yearly.
Say your rent is $1000 per month on a month-to-month lease. Rent is due on the 15th of every month, but you’re planning to move out on the 4th of October. You don’t want to pay for the 5th to the 15th of October, since you won’t be living in the apartment during that time. What’s the amount due for your last month (September 15th to October 4th)?
First, calculate the daily rental rate for September. Since your rent is $1000, you’ll divide that amount by the number of days in the month. Since there are 30 days in September and your rent is $1000, your formula is:
$1000 [your rent] / 30 [days in the month] = $33.3 [your daily rental rate for September]
You’re not done, though. Since the second half of the month is in October, which has 31 days, your daily rental rate will be different for that month.
$1000 [your rent] / 31 [days in the month] = $32.25 [your daily rental rate for October]
Now, multiply each daily rental rate by the number of days you’re paying for in each month, then add those dollar amounts together.
$33.33 [daily rental rate for September] x 15 [days you’ll be in the rental] = $499.95
$32.25 [daily rental rate for October] x 4 [days you’ll be in the rental] = $129.00
$499.95 + $129.00 = $628.95 [your last month’s prorated rent amount]
To calculate prorated rent amount by the year, first find the daily rental rate. Then, subtract the number of days you won’t be in the apartment and divide by 12, for the number of months in a year.
To illustrate, imagine your yearly lease begins on June 1st, and you’ll pay rent on the 1st, but you can’t move in until June 9th. You’ll subtract 8 from 30 days in June to represent the days you’re not living in the apartment yet. Don’t forget to add a day to the yearly total if you’re in a leap year!
$1000 [your rent] x 12 [months in a year] = $12,000 [total annual rent]
$12,000 [total annual rent] / 365 [number of days in a year] = $32.87 [daily rental rate]
$32.87 [daily rental rate] x 8 [days in the year you won’t be in the apartment] = $262.96 [prorated rent deduction for June]
You would then pay only $737.04 for June (that’s $1000 [your rent] - $262.96 [prorated rent deduction for June].
Life rarely fits neatly into a billing cycle. Working with your landlord to prorate your rent can help ease your financial situation during an already hectic time by allowing you to pay only for the days you actually lived in the apartment. If your landlord is open to it, you should take the time to work an agreement about prorated rent into your lease terms.
Bungalow offers affordable private rooms in shared homes in ten cities nationwide. Lease terms range from 3 to 18 months, with the ability to transfer to homes in different cities if needed. Wifi, utilities, and monthly cleaning are set up and included in the monthly rental cost, so that coliving is seamless. Find a Bungalow near you.
Ready to find your next home?
Move-in ready homes and a built-in community so you can feel at home, together — wherever you are.