Gross and net-effective rent calculator
Saw a listing advertised with "net-effective" rent and you're not sure what that means? Use the calculator below to go from "gross" rent to "net-effective" rent and vice versa.
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Net-effective rent
$/mo.
Lease term
months
Months free
month(s)
Broker's fee
month(s)
Gross rent
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Broker's fee
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Rent including fee
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What is the difference between gross rent and net-effective rent?
When looking at apartment listings, it is common to see the terms "gross rent" and "net-effective rent". You may also see an apartment advertised for a certain rent with 1 month free.
What is gross rent?
Gross rent is the listed rent of the apartment before any concessions are applied. This is also the rent amount that will be listed in the lease.
What is net-effective rent?
Net-effective rent is the amount that the tenant will actually pay over the duration of the lease once discounts are applied.
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For example, let’s consider an apartment listed for $2,500 per month. The apartment is offering one month free on a 12-month lease. Here the gross rent would be the $2,500 listed price. The net-effective rent would be lower since the tenant is getting one month free.
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To calculate the net effective rent for this apartment, multiply the gross rent by 11 and then divide by 12. This gives us a net effective rent of $2,291.
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You can use the calculator above to easily calculate the net-effective rent of an apartment.
Why would a landlord not just reduce the rent?
There are many reasons landlords offer rent concessions instead of reducing the rent including financing incentives, rent control and advertising.
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We go into more detail on why a landlord would offer rent concessions in our post on the topic here.
