1. What is the Rental Index?

The Rental Index is a measure that compares current rent prices to a base rent price, expressed as a percentage. It helps track changes in rental prices over time relative to a reference point.

2. How Does the Calculator Work?

The calculator uses the Rental Index equation:

Where:

• Current Rent — The current rental price in any currency
• Base Rent — The reference rental price in the same currency

Explanation: The index shows how much current rent has changed relative to the base rent. A value of 100 means no change, above 100 means increase, below 100 means decrease.

3. Importance of Rental Index

Details: The Rental Index is crucial for landlords, tenants, and real estate analysts to track market trends, adjust lease agreements, and make informed financial decisions.

4. Using the Calculator

Tips: Enter both current rent and base rent in the same currency. Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What does a Rental Index of 120 mean?
A: An index of 120 means current rents are 20% higher than the base rent period.

Q2: How often should the Rental Index be calculated?
A: Typically calculated annually, but can be done more frequently in volatile markets.

Q3: Can I compare indices with different base periods?
A: Not directly. You would need to chain the indices or convert them to a common base period.

Q4: What's a typical base period?
A: Often the first year of a lease or a specific reference year like the start of a market analysis.

Q5: Does this account for inflation?
A: No, this is a nominal index. For real terms analysis, you'd need to adjust for inflation separately.