Property Valuation
An appraiser uses the gross rent multiplier (GRM) method. A Pennsylvania duplex rents for $2,000/month total and comparable properties sell at a GRM of 120. What is the estimated value?
A$200,000
B$240,000✓ Correct
C$280,000
D$320,000
Explanation
GRM × Monthly Rent = Value. 120 × $2,000 = $240,000. The GRM method is a quick income-based valuation tool comparing sales price to gross monthly rent. It does not account for expenses, making it less precise than full income capitalization.
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