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The sale price of $4,000,000 equates to a gross rent multiplier (GRM) of 12, $200,000 price per unit, $182 per square foot and a 4.
The taxpayer's appraiser testified that the property would be valued between $204,000 and $255,000 using the gross rent multiplier method, and the city introduced testimony that an investor had offered $185,000 to purchase the property.
Each category offers 45 formulas to determine market value of the property, vacancy loss, rent multiplier and total net operating income, among others.
The five key variables that are evaluated by InsideRisk include affordability, unemployment, property crime, violent crime and gross rent multiplier.
There also are some ratios that investors like to use, including gross rent multiplier, or GRM (often used to value multi-family properties), the cash on cash ratio, the relationship between annual before tax cash flow and the amount of money the investor contributed from his own pocket, and the capitalization, or CAR rate which is the annual net operating income divided by the value of the property.
The traditional method of paying property management companies a percentage of income is analogous to using the gross rent multiplier as an indication for determining value.
2] are demonstrable estimated monthly incomes (rents) for the two units; and GBM is the monthly gross rent multiplier, the ratio of sale prices to monthly rent for neighborhood properties of similar type and quality, or
Topics covered include: ways to assess potential contributory value of energy-efficient items, how gross rent multiplier analysis and paired analysis support adjustments for green building, and more.
What is a reasonable gross rent multiplier (GRM) for income property?
The sale price Record-equates to a gross rent multiplier of 10.
Next, daily traffic was multiplied by the gross rent multiplier, which was then multiplied by the number of sign faces to arrive at the assessed value.