Property Valuation
Income multiplier methods in Indiana appraisal include the GRM (Gross Rent Multiplier) and the GIM (Gross Income Multiplier). The key difference is:
AGRM uses annual income; GIM uses monthly income
BGRM typically uses monthly rent; GIM typically uses annual gross income from all sources✓ Correct
CGRM is used for commercial; GIM is used for residential
DGRM includes expenses; GIM does not
Explanation
GRM = Sale Price ÷ Monthly Gross Rent (used for residential properties). GIM = Sale Price ÷ Annual Gross Income (used for commercial properties that may have multiple income sources).
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Key Terms to Know
Gross Rent Multiplier (GRM)
A quick valuation metric for income properties calculated by dividing the property price by gross annual rental income.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
Net Operating Income (NOI)The annual income generated by an income-producing property after subtracting operating expenses, but before debt service.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Math Concepts
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