Gross Rent Multiplier
Calculator

GRM is the property price divided by its gross annual rental income, giving a rough multiple of how many years of gross rent it would take to 'pay back' the purchase price. It's a quick screening tool, not a full profitability measure.

GRM intentionally uses gross rent instead of net operating income, which makes it faster to calculate — often before you even know detailed operating expenses — but also less precise. It's best used to quickly compare or screen properties, then followed up with a cap rate or cash flow analysis.

Generally yes, since a lower GRM means the property costs fewer years of gross rent to purchase, suggesting better relative value. But GRM alone can be misleading if expenses, vacancy, or property condition differ significantly between properties being compared.

There's no universal good number — GRM benchmarks vary widely by city and property type, often ranging from under 5 in cash-flow-focused markets to 15 or more in high-appreciation coastal markets. Compare a property's GRM to similar local properties rather than a fixed rule of thumb.

The standard GRM formula uses annual gross rent, so if you only know the monthly rent, multiply it by 12 before entering it, or confirm which the calculator expects. Mixing monthly and annual figures will produce a multiplier that's off by a factor of 12.