A California appraiser needs to extract a GRM from a comparable sale. A fourplex in Riverside, California recently sold for $680,000. The four units were renting at $1,250, $1,300, $1,200, and $1,250 per month at the time of sale. What is the monthly Gross Rent Multiplier?
Correct Answer
D) 136.0
Step 1: Total monthly rent = $1,250 + $1,300 + $1,200 + $1,250 = $5,000. Step 2: Monthly GRM = Sale Price / Monthly Rent = $680,000 / $5,000 = 136.0.
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Previous Question
A California appraiser is using the income approach for a mixed-use property in downtown Los Angeles. The property has retail space on the ground floor and apartments above. The apartments are subject to the LA Rent Stabilization Ordinance, but the retail space is not. How should the appraiser handle the income analysis?
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A California appraiser is determining the appropriate vacancy rate for a 20-unit apartment complex in San Jose. The property has had a consistent 2% vacancy rate over the past three years, but the market vacancy rate for comparable properties in San Jose is 5%. Which vacancy rate should the appraiser use in the income approach?