Property Valuation
The gross rent multiplier (GRM) is calculated by dividing the:
ANet operating income by the sale price
BSale price by the annual gross rent✓ Correct
CGross rent by the cap rate
DMonthly rent by the vacancy rate
Explanation
GRM = Sale Price divided by Annual Gross Rent. It is a quick valuation tool that does not account for operating expenses, making it less precise than the income capitalization approach but useful for quick comparisons of similar rental properties.
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