Property Valuation
In Minnesota, the 'income approach' for a small residential rental property (1-4 units) typically uses the:
ADiscounted cash flow analysis
BGross rent multiplier (GRM) method as a quick check alongside the sales comparison approach✓ Correct
CFull capitalization approach with detailed NOI analysis
DOnly the cost approach as a secondary method
Explanation
For small residential rental properties (1-4 units) in Minnesota, the gross rent multiplier (GRM) is commonly used as a quick income approach check. It compares the property's sale price to its monthly gross rent. This simpler method is appropriate given the residential nature of these properties, where buyers often focus on comparable sales rather than detailed income analysis.
Related Minnesota Property Valuation Questions
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