Property Valuation
A gross rent multiplier (GRM) is calculated by:
ADividing the NOI by the cap rate
BDividing the property's sale price by its gross monthly rent✓ Correct
CMultiplying the monthly rent by 12
DDividing the annual rent by the cap rate
Explanation
GRM = Sale Price ÷ Gross Monthly Rent. The GRM is a quick tool to compare rental properties and can be used to estimate value: Value = GRM × Gross Monthly Rent.
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