Property Valuation
The 'gross rent multiplier' (GRM) method for valuing a single-family rental in New Mexico requires:
ANet operating income and cap rate
BAnnual or monthly gross rent and comparable GRMs from similar properties✓ Correct
CReplacement cost and depreciation
DSquare footage and price per square foot
Explanation
GRM = Sales Price / Gross Rent (annual or monthly). To value a property: Value = GRM x Subject's Gross Rent. Comparable GRMs are derived from recent sales of similar rental properties in the market.
Related New Mexico Property Valuation Questions
- In New Mexico, an appraiser who determines the value of a property 'as completed' for a proposed new home construction is providing a:
- The income approach to value is most often used for:
- The principle of substitution states that:
- The principle of progression in real estate valuation means that:
- Highest and best use is defined as the use that is:
- An appraiser using the income approach calculates a capitalization rate by dividing:
- Which principle of appraisal states that value is created by the expectation of future benefits?
- In New Mexico, 'paired sales analysis' in appraisal is used to:
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