Property Valuation
Gross Rent Multiplier (GRM) is calculated as:
ANOI / Cap Rate
BSale Price / Annual (or Monthly) Gross Rent✓ Correct
CAnnual rent / Operating expenses
DSale price / Number of units
Explanation
GRM = Sale Price / Gross Rent (annual or monthly, but must be consistent). It is a quick tool to compare income properties. A lower GRM generally indicates a better investment at that price.
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