Property Valuation
In the income approach to valuing a Missoula apartment complex, the gross rent multiplier (GRM) is calculated by:
ADividing annual NOI by the cap rate
BDividing sale price by annual gross rental income✓ Correct
CMultiplying monthly rent by 100
DSubtracting vacancies from gross potential income
Explanation
The Gross Rent Multiplier (GRM) = Sale Price ÷ Annual Gross Rental Income. It is a quick valuation tool that allows comparisons between similar income properties in markets like Missoula without requiring detailed expense analysis.
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