Property Valuation
Gross Rent Multiplier (GRM) is calculated as:
ASale Price ÷ Net Operating Income
BSale Price ÷ Gross Monthly (or Annual) Rent✓ Correct
CNet Operating Income ÷ Sale Price
DGross Rent ÷ Vacancy Rate
Explanation
GRM = Sale Price ÷ Gross Rent. For example, if a property sells for $300,000 and has monthly rent of $2,500, GRM = $300,000 ÷ $2,500 = 120. GRM is a quick valuation tool but does not account for expenses.
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