1. A single-family home rents for $2,100 per month. Comparable homes sell at an ANNUAL gross rent multiplier of 12. What is the estimated value?
Answer & explanation
Answer: C. Annual rent = $2,100 x 12 = $25,200; value = $25,200 x 12 = $302,400.
valuation
gross rent multiplier
A gross rent multiplier is a simple valuation tool that relates a property's sale price to its gross rent, typically monthly rent for one- to four-unit residential properties. It is calculated by dividing sale price by gross rent from comparable sales, then multiplying the subject's rent by that multiplier to estimate value. It ignores expenses and vacancy, so it is a rough estimate.
- Exam tip
- GRM usually uses monthly rent for residential; GIM uses annual income for commercial. Value = rent x multiplier, and multiplier = price / rent.
- Example
- Comps show a GRM of 150; a house renting for $2,000 per month has an estimated value of $300,000.
Related terms & state variants
Sources
Source verification pending. Confirm current requirements with your state regulator.
Last verified: 2026-10-23