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Questions and Answers
If the annual income of a property is $24,000 and the GRM is 146, what is the property's estimated value?
If the annual income of a property is $24,000 and the GRM is 146, what is the property's estimated value?
- $2,920,000
- $2,400,000
- $3,504,000
- $292,000 (correct)
What is the Gross Rent Multiplier (GRM) for a property generating $2,000 per month and valued at $218,000?
What is the Gross Rent Multiplier (GRM) for a property generating $2,000 per month and valued at $218,000?
- 9.09
- 115
- 90.9
- 109 (correct)
What is the Gross Rent Multiplier for a home that sold for $360,000 with a monthly rental income of $3,000?
What is the Gross Rent Multiplier for a home that sold for $360,000 with a monthly rental income of $3,000?
- 15
- 120 (correct)
- 30
- 25
If a property is valued at $340,000 and has a Gross Rent Multiplier of 148, what is the property's monthly income?
If a property is valued at $340,000 and has a Gross Rent Multiplier of 148, what is the property's monthly income?
What is the Gross Income Multiplier (GIM) for a tri-plex that generates $700 rent for each of its three units per month and appraised for $413,000?
What is the Gross Income Multiplier (GIM) for a tri-plex that generates $700 rent for each of its three units per month and appraised for $413,000?
If each unit in a fourplex rents for $850 per month and is appraised at $460,000, what is the GRM?
If each unit in a fourplex rents for $850 per month and is appraised at $460,000, what is the GRM?
A property with a Gross Income Multiplier of 12 and a value of $500,000 has what annual income?
A property with a Gross Income Multiplier of 12 and a value of $500,000 has what annual income?
An income-producing property that rents for $1,000 per month and has a GRM of 84, what is its estimated market value?
An income-producing property that rents for $1,000 per month and has a GRM of 84, what is its estimated market value?
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Study Notes
Gross Rent Multiplier (GRM) Overview
- GRM is calculated by dividing the property's price by its annual rental income.
- Helps assess value in relation to rental income.
Card 1: Property Valuation Example
- Comparable sales indicate a GRM of 146.
- Annual income of $24,000 equates to a monthly income of $2,000.
- Estimated property value calculated as $2,000 x 146 = $292,000.
Card 2: Calculating Gross Rent Multiplier
- Property generates monthly income of $2,000 and valued at $218,000.
- GRM determined by $218,000 ÷ $24,000 (annual income) = 109.
Card 3: Finding GRM from Sales Price and Rent
- Home sold for $360,000 with a monthly rental income of $3,000.
- GRM calculation: $360,000 ÷ $3,000 = 120.
Card 4: Monthly Income Determination
- Property valued at $340,000 with a GRM of 148.
- Monthly income can be determined by $340,000 ÷ 148 = $2,297.
Card 5: Tri-Plex Income and Valuation
- Tri-plex rents for $700/unit monthly, totaling $2,100 monthly income.
- Annual income calculated as $2,100 x 12 = $25,200.
- GIM calculated by $413,000 ÷ $25,200 = 16.4.
Card 6: Fourplex GRM Calculation
- Fourplex units rent for $850/month, generating $3,400 monthly income.
- Appraised value is $460,000, leading to GRM of $460,000 ÷ $3,400 = 135.3.
Card 7: Annual Income from GIM
- Property has a GIM of 12 and a value of $500,000.
- Annual income calculated by $500,000 ÷ 12 = $41,667.
Card 8: Market Value Estimation
- Income-producing property rents for $1,000/month with a GRM of 84.
- Estimated market value determined as 84 x $1,000 = $84,000.
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