Direct answer
What does Net lease mean?
A lease under which the tenant pays specified property expenses in addition to rent.
Exam cue: Read which expenses shift to the tenant. Net, double-net and triple-net labels can vary by document and market usage.
What does it look like in a question?
New York example
A commercial tenant pays base rent plus property taxes, insurance and maintenance under the lease terms.
Common exam trap
What should you not confuse it with?
Net lease does not mean the landlord has no remaining duty or expense.
Related commercial and investment terms
Cash flowMoney remaining or changing hands during a period after the receipts and payments included in the stated calculation.Effective gross incomeIncome expected or received after vacancy and collection loss, plus other property income included in the analysis.Gross leaseA lease in which the landlord pays specified property operating expenses from the rent received.LeverageThe use of borrowed money to finance part of an investment.LiquidityThe ease and speed with which an asset can be converted to cash without a substantial loss in value.Net operating incomeProperty income remaining after vacancy and operating expenses but before debt service and income taxes in the standard real estate formula.
Sources used1 reference with section locators
The curriculum citation confirms exam scope. Definition and rule citations support the explanation itself. Links and locators were checked on August 26, 2026.
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Put the term back into its full subject.
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