Property Valuation
In Arizona, the 'effective gross income multiplier' (EGIM) is more useful than the GRM because:
AEGIM accounts for vacancy and collection loss while GRM uses only potential gross income✓ Correct
BEGIM is simpler to calculate
CEGIM is required by USPAP
DGRM cannot be used for Arizona properties
Explanation
The EGIM uses effective gross income (after vacancy and collection losses) rather than potential gross income. It provides a more accurate comparison because it reflects actual market occupancy levels rather than theoretical 100% occupancy.
Related Arizona Property Valuation Questions
- An Arizona property has 4 units each renting for $1,200/month. Using a GRM of 120, what is the estimated value?
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- In Arizona, when a buyer pays more than the appraised value for a property, the difference is called:
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