A fourplex is listed at $1,080,000. Its gross scheduled rents total $90,000 a year. What is its gross rent multiplier based on annual rents?
Correct Answer
A) 12
The gross rent multiplier is price divided by gross annual rent: $1,080,000 ÷ $90,000 = 12. Dividing rent by price gives 0.083 (8.3%), and using monthly rent of $7,500 gives a monthly multiplier of 144.
Why This Is the Correct Answer
Price divided by gross annual rent is $1,080,000 ÷ $90,000, which gives a gross rent multiplier of 12.
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