A property's gross monthly rent is $2,000. Its gross rent multiplier (GRM) in the market is 150. What is the estimated property value using the GRM method?

GRM (Gross Rent Multiplier) method: Property Value = Gross Monthly Rent × GRM. So $2,000 × 150 = $300,000. The GRM is a quick approximation used for small income properties. It is a ratio derived from comparable sales in the market: take recent sale price ÷ monthly rent for several comparables to find typical GRMs. A higher GRM means properties are selling for more relative to their rent; lower GRM means rents are higher relative to price. GRM ignores expenses, vacancy, and financing — it is a back-of-envelope tool, not a full investment analysis. For more rigorous valuation of income property, appraisers use the income capitalization approach with NOI (Net Operating Income) and a cap rate.