Property Valuation
Gross Rent Multiplier (GRM) is calculated as:
AAnnual gross rent ÷ Property value
BProperty value ÷ Monthly gross rent✓ Correct
CNet operating income ÷ Cap rate
DMonthly rent × 12 ÷ Vacancy rate
Explanation
GRM = Property value ÷ Monthly (or annual) gross rent. It provides a quick valuation benchmark by comparing similar income properties without adjusting for expenses.
Related Nebraska Property Valuation Questions
- An appraisal for a federally related mortgage transaction in Nebraska requires the appraiser to include a:
- The principle of conformity holds that a property achieves maximum value when:
- In Nebraska farmland valuation, which factor has the greatest impact on per-acre value?
- Depreciation in the cost approach to appraisal is divided into three categories. Which of the following is an example of 'physical deterioration'?
- The income approach to value is most often used for:
- Accrued depreciation in the cost approach is:
- In the income approach, potential gross income (PGI) represents:
- An appraiser using the gross rent multiplier (GRM) approach needs to know:
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