Real Estate Math
A Manchester, NH investor purchases a 4-unit apartment building for $520,000. Each unit rents for $1,100/month. What is the Gross Rent Multiplier (GRM)?
A9.85
B11.82✓ Correct
C10.5
D118.2
Explanation
Monthly gross rent = 4 units × $1,100 = $4,400. GRM = $520,000 / $4,400 = 118.18. But GRM is typically expressed as a multiple of monthly rent. Answer D (118.2) is the monthly GRM. If annual: $4,400 × 12 = $52,800; Annual GRM = $520,000 / $52,800 = 9.85. The question asks for GRM using monthly rent, so 118.2 is correct for monthly.
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