Gross Rent Multiplier (GRM)
A quick valuation tool equal to sale price divided by gross rent, using gross income rather than net.
Quick flashcard
What does Gross Rent Multiplier (GRM) mean on the Texas real estate exam?
Answer: A quick valuation tool equal to sale price divided by gross rent, using gross income rather than net.
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Gross Rent Multiplier (GRM) definition
The gross rent multiplier is a fast way to compare income properties. It equals the sale price divided by the gross rental income. Because it uses gross rent, it does not account for vacancy or operating expenses.
GRM is a screening tool, not a precise value. Appraisers use it for quick comparison and rely on the full income approach for a supported value.
Source basis
Definition checked against the official sources below on .
On the exam
Worked example
Worked example
A 480,000 dollar price divided by 57,600 dollars of gross annual rent equals a GRM of 8.33.
Exam trap
Tested in
Value & Appraisal (11 of 80 National)
From definition to recall
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Try 5 free questionsThis definition is Texas real estate exam-prep education, not legal, tax, or professional advice. Verify current rules against the official source before relying on them for a real transaction. Back to the full glossary.