NYC rental math · Concession analysis
Translate the concession into the rent you actually carry.
Compare advertised net effective rent with the gross monthly payment and the all-in lease cost after free months, fees and other discounts.
Use the calculatorNet effective rent calculator
Convert an incentive into a comparable monthly figure.
Enter the lease term, gross rent and every relevant concession or fee to compare competing apartments on the same monthly basis.
Monthly Rent
Net Effective Rent
Broker Fee
Monthly Effective Rent Including Fees
Net Effective Rent Including Fees
Read the offer clearly
Net effective rent is a comparison tool—not always the monthly payment.
Use the calculator to organize assumptions. Use documents, current quotes and licensed professionals to confirm the decision.
Gross rent
The lease commonly requires the stated gross rent during paid months even when marketing highlights a lower effective amount.
Free rent and credits
The timing and conditions of concessions can affect move-in cash, default provisions and renewal economics.
Fees and recurring charges
Broker fees, amenity charges and other required costs may change which apartment is truly less expensive.
Work the numbers
A worked net effective rent example.
Assume an apartment has a gross monthly rent of $3,000 with two months free on a 14-month lease.
The tenant may still owe $3,000 during each paid month. The $2,571 figure spreads the concession across the full lease term so the offer can be compared with other apartments.
Compare the full obligation
Compare cash flow as well as effective rent.
Two apartments can advertise similar effective rents while requiring very different amounts of cash. Before choosing between offers, compare:
- The rent actually due during paid months
- When free months or credits are applied
- Total cash required before move-in
- Mandatory amenity, application, move-in or pet charges
- Whether concessions must be repaid after default or early termination
- The gross rent that may be used for renewal
NYC broker-fee considerations
Include only fees the tenant must actually pay.
Under New York City’s FARE Act, a broker representing the landlord generally cannot charge a broker fee to the tenant. A renter may still choose to retain and compensate their own broker.
Confirm who engaged the broker, the services being provided and every required fee before relying on the calculator’s final result.
Frequently asked questions
Net-effective-rent questions, answered.
What is net effective rent?
It is the average monthly rent after spreading qualifying concessions across the lease term. It may differ from the amount due in a paid month.
How are free months calculated?
Subtract the value of free rent from the gross lease cost, add relevant fees or credits, then divide by the lease term.
Which rent is used for renewal?
The lease and renewal offer control. Renewal increases are commonly based on gross rent rather than the advertised net effective figure.
Should a broker fee be included?
Include a broker fee only when the tenant is actually responsible for paying it. Under New York City’s FARE Act, a broker representing the landlord generally cannot charge that fee to the tenant. A tenant may still choose to hire and compensate their own broker. Confirm who engaged the broker and every required fee before comparing the final cost.
Concessions made comparable
Shortlist rentals by the terms you will actually carry.
Rental concessions
Net effective rent helps compare deals—but the lease is written at the gross rent.
Free months and other concessions can lower the average cost over the initial term while leaving the legal or gross monthly rent unchanged. Compare both numbers.
Know the contractual monthly rent.
The lease may state a higher gross rent even when the initial concession makes the average first-term cost lower.
Identify exactly what is free.
Free rent, owner-paid fees or other incentives should be confirmed in the lease or rider rather than inferred from marketing.
Spread the concession across the correct period.
One or two free months produce different effective rents depending on whether the lease is 12, 13, 14 or more months.
The payment schedule may not be level.
A concession can be applied at the beginning, end or another point in the lease, affecting actual month-to-month cash needs.
Do not assume the concession repeats.
Renewal discussions may begin from the gross rent and current market, not the initial net-effective figure.
Use all-in occupancy cost.
Fees, utilities, amenity charges and required services can make apartments with similar net-effective rents economically different.
WORK THE NUMBERS · LIVE EXAMPLE
A worked net effective rent example you can change.
Start with the example below, then edit the gross rent, lease term or paid months. The comparison and equation update immediately.
EXAMPLE LOADED · EDIT ANY FIELD