Property Valuation
A gross rent multiplier (GRM) is calculated by:
ADividing net operating income by the cap rate
BDividing the sales price by the gross monthly rent✓ Correct
CMultiplying the net income by the vacancy rate
DDividing annual expenses by the total rent collected
Explanation
GRM = Sales Price ÷ Gross Monthly Rent. It is a quick estimation tool used to compare income-producing properties.
Related Kansas Property Valuation Questions
- In Kansas, the 'paired sales analysis' technique is used by appraisers to:
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