11 - Income Capitalization Approach Flashcards
The _______ _______ ________ is the relationship or ratio between the sale price or value of a property and it’s periodic gross rental income
Gross Rent Multiplier
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T/F - The GRM is typically used for storage units and commercial properties
False
It is used for SFR’s and up to 4-unit properties
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A GRM analysis is effective when the properties being compared have __________ operating Expense ratios
A - Similar
B - Equal
C - Different
Similar
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Use ________ rent in the GRM, not the contract rent
Market
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Market conditions (should)/(should not) effect the GRM
Should not
Since GRM is a ratio, it should remain fairly consistent as rent rates typically rise at the same rate as sale prices
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