Property Valuation
The gross rent multiplier (GRM) for a Kentucky residential rental property is calculated as:
ASale price ÷ Annual NOI
BSale price ÷ Monthly gross rent✓ Correct
CMonthly rent × 12 ÷ Sale price
DNOI ÷ Sale price × 100
Explanation
GRM = Sale price ÷ Monthly gross rent. The GRM is a simple valuation tool that relates the sale price to monthly gross rental income. For example, a property selling for $150,000 with $1,000/month rent has a GRM of 150.
Related Kentucky Property Valuation Questions
- An appraiser is estimating the value of a Kentucky commercial building. The effective gross income (EGI) is calculated as:
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