Question

One of your Client wants to purchase a Rental Property that is generating $2,500 per month in Rents. You have decided to use Gross Rent Multiplier (GRM) method, using the recently sold following comparable Rental properties in order to calculate the Value of the subject property:

Property	Rent Pm	Sold for	Weight
1	$ 1,800.00	$ 657,000.00	20%
2	$ 2,100.00	$ 700,000.00	25%
3	$ 1,500.00	$ 520,000.00	20%
4	$ 2,700.00	$ 785,000.00	35%

Based on your calculation, the approximate price of the subject rental property is:

	a.	$912,500
	b.	$ 833,300
	c.	$818,560
	d.	$726,850

Answer 1