---
title: How to Compare Real Estate Payment Plans: NPV and IRR Guide
description: Why a long payment plan is worth less than its list price, and how developers compare plans using NPV, IRR and the break-even cash discount.
---

- [Home](https://aqartab.com/)
- [Guides](https://aqartab.com/guides)
- How to compare real estate payment plans
Guide
# How to compare real estate payment plans
Updated: 2026-11-06 · XSquare
In short
Compare payment plans by what they are worth today, not by their total. Discount every installment at your cost of capital and add them up to get the plan's net present value (NPV), then compare plans as a percentage of list price.

## Why the total is misleading
Two plans can both add up to the list price, yet one collects most of its money in year one and the other in year ten. Money later is worth less than money now, because you could use it today to build or to repay financing. A long plan is a discount that does not appear on the offer sheet.

## Net present value (NPV)
NPV is the value today of all the plan's installments. Each payment is discounted by your discount rate for the time until it is paid, then all of them are added up. Showing NPV as a percentage of list price makes plans easy to rank.

## Internal rate of return (IRR)
IRR is the yearly rate at which the plan's installments are worth exactly your cash price. If it is below your cost of capital, the plan costs you money compared with a cash sale.

## The break-even cash discount
The gap between list price and present value tells you the most a cash buyer should get off today. It gives you a discount you can defend, not one that sales negotiates by feel.

## What to do with weak plans
You do not have to withdraw a long plan. You can raise its price, shorten it, or keep it deliberately as a launch offer. What matters is that the decision is visible.

## Use one rate table
Finance should own a single table of discount rates. If sales, finance and the board all read the same rate, they look at the same numbers.
Image: Comparison of payment plans by present value and yield
Screenshot of the live product, demo data.
[Pricing Studio](https://aqartab.com/pricing)
Questions

## Common questions

### What discount rate should a developer use?
Usually your cost of capital, set by finance. Keep it in one table with valid-from dates, so that everyone reads the same figure.

### Is NPV the same as the price?
No. The price is the total of the installments. NPV is what those installments are worth today, which is lower for longer plans.

## See it on your own project.
Bring your project, your payment plans and your hardest questions. We walk you through the system in a live demo.
[Book a demo](https://aqartab.com/demo)