Enter your home's total beds, monthly fee per bed, collection rate, and current (or projected) occupancy in the left panel. Then fill in every monthly cost category. Results update instantly in the right panel.
Set your beds & fee. Enter total bed capacity and your monthly fee per bed.
Adjust collection rate. If residents sometimes miss payments or you offer discounts, lower this below 100%. Most operators use 90–95%.
Enter all monthly costs. Be thorough — hidden costs are the most common cause of first-year losses.
Read your results. The large card shows your break-even occupancy %. The scenario table shows cash flow at 60%, 80%, and 95% occupancy.
Print or share. Use "Print / Save PDF" for a clean summary to show partners or lenders.
The Formulas Explained
Gross Potential Revenue = Total beds × Monthly fee per bed Effective Collected Revenue = Gross × Occupancy % × Collection rate % Break-Even Beds = Total monthly expenses ÷ (Monthly fee × Collection rate) Break-Even Occupancy % = Break-even beds ÷ Total beds × 100 Net Monthly Cash Flow = Effective collected revenue − Total monthly expenses Operating Margin % = (Net cash flow ÷ Effective collected revenue) × 100 Startup Payback = Startup capital ÷ Net monthly cash flow (months)
Method follows the break-even framework described by the National Alliance for Recovery Residences (NARR) and widely used by operators nationwide. This tool is an estimate for planning purposes only — not professional financial or legal advice.
When & Why Operators Use This
Before signing a lease or purchasing a property, every operator should know the minimum occupancy needed to cover costs. Over-optimistic projections are the most common reason new recovery homes fail financially. This calculator lets you stress-test your model at conservative (60%), moderate (80%), and strong (95%) occupancy so you enter operations with clear eyes.
Experienced operators also use it monthly to track whether their effective collected revenue is on target — because actual collections (after arrears and partial payments) often differ from listed rent.
Frequently Asked Questions
What occupancy rate does a sober living home need to break even?
Most sources cite roughly 70% occupancy as the typical break-even point for a reasonably priced home. However, the precise figure depends entirely on your total beds, fee per bed, collection rate, and fixed costs. A home with high rent relative to its bed fee may need 85%+ just to cover expenses, while a well-priced home in a lower-cost market might break even at 65%. Use this calculator with your real numbers — the industry average is just a rough guide.
How do you calculate break-even beds for a recovery residence?
Divide your total monthly operating expenses by the effective revenue per occupied bed (monthly fee × collection rate). For example: if your costs are $8,000/month, fee is $800/bed, and collection rate is 95%, you need $8,000 ÷ ($800 × 0.95) = 10.5 beds occupied to break even. If you have 12 beds total, that's an 88% break-even occupancy — meaning any dip below 88% puts the house in the red. This calculator does that math instantly.
What is a realistic operating margin for a sober living home?
Well-run, stabilized homes typically achieve 20–35% operating margins. Most operators reach profitability within 6–18 months, depending on how quickly they fill beds. Year one operators should model conservatively, assuming 40–60% occupancy during the ramp-up period. The economics improve significantly with scale: a second or third property spreads administrative costs across more beds without proportionally higher overhead.
Why is collection rate different from occupancy rate?
Occupancy rate tells you what share of beds are physically filled. Collection rate tells you what share of listed rent you actually receive. A bed can be occupied by a resident who is two weeks behind on payment — it counts as occupied but generates no current cash. Successful operators track both metrics separately and model revenue using collected revenue, not just listed rent. Typical collection rates range from 90–97% for well-managed homes.
How many beds do most sober living homes have?
First-time operators typically start with 6–12 beds. The financial sweet spot for profitability is generally 8–16 beds per location, where fixed costs spread efficiently without overcrowding. Recovery residences nationally average around 9 beds per home. Smaller homes (4–6 beds) are highly sensitive to vacancies — a single empty bed in a 5-bed home represents 20% of total revenue capacity, which can easily wipe out the month's margin.
Should I charge weekly or monthly rent?
Both models are common. Weekly billing (e.g. $175–$225/week in many markets) is standard for early-recovery housing and gives residents smaller individual payments, which can reduce late-payment risk. Monthly billing simplifies your accounting and is common for mid- to higher-amenity homes. When comparing, convert to a consistent monthly equivalent: weekly rate × 52 ÷ 12. Enter the monthly equivalent in this calculator regardless of your actual billing cycle.
What costs do new sober living operators most often underestimate?
The three most underestimated costs are: (1) Vacancy buffer — plan for 3–6 months of operating reserves before your first resident moves in; (2) Maintenance and repairs — HVAC, plumbing, and appliance issues hit at unpredictable times; (3) Staff and administration — even a part-time house manager stipend adds up, and administrative overhead (insurance, accounting, drug testing) is higher than most people budget. Enter conservative estimates here rather than best-case numbers.