Using a monthly gross rent multiplier, what is the GRM of a property that sells for $800,000 and collects monthly rent of $4,000?
Correct Answer
C) 200
A monthly gross rent multiplier is the sale price divided by monthly gross rent: $800,000 ÷ $4,000 = 200. An annual GRM would divide by annual rent ($48,000) instead and give about 16.7, but the question asks for the monthly multiplier.
Why This Is the Correct Answer
200 is correct because the monthly GRM is the sale price divided by the monthly gross rent: $800,000 ÷ $4,000 = 200.
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