{"id":11371,"date":"2019-11-18T17:47:57","date_gmt":"2019-11-18T22:47:57","guid":{"rendered":"https:\/\/www.renthop.com\/content-manager\/?p=11371"},"modified":"2023-07-22T11:36:41","modified_gmt":"2023-07-22T15:36:41","slug":"what-is-net-effective-price","status":"publish","type":"post","link":"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/","title":{"rendered":"What is Net Effective Rent?"},"content":{"rendered":"\r\n<p>The net effective rent is the monthly amount the tenant pays to the landlord after factoring in incentives. The term is common when searching for apartments\u00a0 in <a href=\"https:\/\/www.renthop.com\/apartments-for-rent\/new-york-ny\">New York City<\/a>, especially during the <a href=\"https:\/\/www.renthop.com\/blog\/is-now-a-good-time-to-rent\/\">off-peak<\/a> winter season. This is when landlords increasingly offer rental incentives. You can find a <a href=\"https:\/\/www.renthop.com\/blog\/2018\/08\/what-does-net-effective-rent-actually-mean-and-what-do-i-end-up-paying\/\">deeper discussion of net effective rent on our rental guide<\/a>.<\/p>\r\n<h2>Example of Net Effective Rent<\/h2>\r\n\r\n\r\n\r\n<p>Here is a simple example. When a landlord is asking for $3600 monthly gross rent, but is offering 1 month free on a 12 month lease. The net effective rent is the gross * (12 months &#8211; 1 free month) \/ (12 months). In this case, $3600 * 11\/12 = $3300 net effective.<\/p>\r\n\r\n\r\n\r\n<p>This structure is useful for comparing rent in a building offering renter incentives to a building that is not. However, keep in mind the net effective is not guaranteed after the initial lease period &#8211; in fact without further negotiation, you can expect to pay the gross after the initial lease period.<\/p>\r\n\r\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-10401\" src=\"https:\/\/www.renthop.com\/content-manager\/wp-content\/uploads\/2019\/11\/2_gold.jpg\" alt=\"\" width=\"775\" height=\"427\" \/><br \/>Also, not all calculations are 1 month free on 12 months. This week&#8217;s inventory from the <a href=\"https:\/\/www.renthop.com\/building\/2-gold-street-new-york-ny-10038\">2 Gold Street<\/a>, a popular financial district high rise, has 3 different structures in the fine print! You get 1 month free on 12 for a studio, 1.5 months free on a 2 or 3 bedroom, except one listing, unit 5012, offers 2 months free on a 16 month lease. In every case, the &#8220;rent&#8221; column shows the net effective already, so to compute your gross at renewal, you would need to do the math backwards!<\/p>\r\n\r\n<p><em>Editor&#8217;s Note: We updated this article to enhance readability.\u00a0<\/em><\/p>\r\n","protected":false},"excerpt":{"rendered":"<p>The net effective rent is the monthly amount the tenant pays to the landlord after factoring in incentives. The term is common when searching for apartments\u00a0 in New York City, especially during the off-peak winter season. This is when landlords increasingly offer rental incentives. You can find a deeper discussion of net effective rent on [&hellip;]<\/p>\n","protected":false},"author":4,"featured_media":11386,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"yes","_lmt_disable":"no","footnotes":""},"categories":[440],"tags":[73,295,97,296,43],"class_list":{"0":"post-11371","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-rental-glossary","8":"tag-brokers","9":"tag-hopscore","10":"tag-landlords","11":"tag-net-effective","12":"tag-renthop"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.4 (Yoast SEO v24.1) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What is Net Effective Rent? - Real Estate Topics, Tips, and Guides<\/title>\n<meta name=\"description\" content=\"Today we&#039;ll cover net effective rent, and how it differs from the gross rent. Renters should understand the differences.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What is Net Effective Rent?\" \/>\n<meta property=\"og:description\" content=\"Today we&#039;ll cover net effective rent, and how it differs from the gross rent. Renters should understand the differences.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/\" \/>\n<meta property=\"og:site_name\" content=\"Real Estate Topics, Tips, and Guides\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/renthopapartments\" \/>\n<meta property=\"article:published_time\" content=\"2019-11-18T22:47:57+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-07-22T15:36:41+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.renthop.com\/blog\/wp-content\/uploads\/2019\/11\/neteffectiveprice.png\" \/>\n\t<meta property=\"og:image:width\" content=\"1024\" \/>\n\t<meta property=\"og:image:height\" content=\"512\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Lee Lin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@renthop\" \/>\n<meta name=\"twitter:site\" content=\"@renthop\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Lee Lin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/\"},\"author\":{\"name\":\"Lee Lin\",\"@id\":\"https:\/\/www.renthop.com\/blog\/#\/schema\/person\/5877a1d4b27a98e84d9840c6aea99af7\"},\"headline\":\"What is Net Effective Rent?\",\"datePublished\":\"2019-11-18T22:47:57+00:00\",\"dateModified\":\"2023-07-22T15:36:41+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/\"},\"wordCount\":249,\"publisher\":{\"@id\":\"https:\/\/www.renthop.com\/blog\/#organization\"},\"image\":{\"@id\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.renthop.com\/blog\/wp-content\/uploads\/2019\/11\/neteffectiveprice.png\",\"keywords\":[\"brokers\",\"HopScore\",\"landlords\",\"net effective\",\"RentHop\"],\"articleSection\":[\"Rental Glossary\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/\",\"url\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/\",\"name\":\"What is Net Effective Rent? - Real Estate Topics, Tips, and Guides\",\"isPartOf\":{\"@id\":\"https:\/\/www.renthop.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.renthop.com\/blog\/what-is-net-effective-price\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.renthop.com\/blog\/wp-content\/uploads\/2019\/11\/neteffectiveprice.png\",\"datePublished\":\"2019-11-18T22:47:57+00:00\",\"dateModified\":\"2023-07-22T15:36:41+00:00\",\"description\":\"Today we'll cover net effective rent, and how it differs from the gross rent. 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