QuestionMay 27, 2025

A rental property is listed for sale at 500,000 and generates an annual gross rental income of 50,000 What is the Gross Rent Multiplier (GRM) for this property? Select the best answer 10 12 8 15

A rental property is listed for sale at 500,000 and generates an annual gross rental income of 50,000 What is the Gross Rent Multiplier (GRM) for this property? Select the best answer 10 12 8 15
A rental property is listed for sale at 500,000 and generates an annual gross rental income of 50,000 What is the Gross
Rent Multiplier (GRM) for this property?
Select the best answer
10
12
8
15

Solution
4.5(271 votes)

Answer

10 Explanation 1. Define Gross Rent Multiplier (GRM) GRM is calculated as the ratio of the property's price to its annual gross rental income. 2. Calculate GRM Use the formula: **GRM = \frac{\text{Property Price}}{\text{Annual Gross Rental Income}}**. Substitute the given values: **GRM = \frac{500,000}{50,000}**. 3. Simplify the Calculation Divide 500,000 by 50,000 to get the GRM.

Explanation

1. Define Gross Rent Multiplier (GRM)<br /> GRM is calculated as the ratio of the property's price to its annual gross rental income.<br /><br />2. Calculate GRM<br /> Use the formula: **GRM = \frac{\text{Property Price}}{\text{Annual Gross Rental Income}}**. Substitute the given values: **GRM = \frac{500,000}{50,000}**.<br /><br />3. Simplify the Calculation<br /> Divide 500,000 by 50,000 to get the GRM.
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