Property Valuation
An appraiser values a Bismarck, ND apartment building by dividing its annual gross rental income by its sale price to determine the:
ACapitalization rate
BGross rent multiplier (GRM)✓ Correct
CNet operating income
DEffective gross income
Explanation
The Gross Rent Multiplier (GRM) is calculated by dividing the sale price by the annual (or monthly) gross rent. It is a quick method for estimating value for small income properties.
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