Gross Rent Multiplier (GRM)
GRM = price ÷ annual gross rent से quick property screening। Lower GRM = better cash yield। अपने city के market range से compare करें।
GRM ignores operating expenses entirely. Two properties with identical GRM can have radically different cap rates if one has high property tax or HOA. Use as first-pass screen only — confirm with cap-rate before offering.
GRM क्या है?
Gross Rent Multiplier सबसे simple property valuation metric है: price ÷ annual gross rent। ₹40 lakh की property जो ₹2,64,000/year rent देती है → GRM 15.15×। Lower GRM = better cash yield।
Cap rate का quick version। Cap rate NOI use करता है, GRM gross rent use करता है। Faster but less precise। Screening के लिए useful।
Formula
GRM = Price ÷ Annual Gross Rent Gross yield = 1 ÷ GRM × 100% Max price = Rent × Target GRM
Typical ranges (rough, 2026)
- Primary coastal (NY/SF/LA): 18–28×
- Primary non-coastal (Chicago/DC): 14–20×
- Secondary metro: 10–15×
- Tertiary: 7–12×
- Rural: 5–10×
- European mature (London/Paris/Madrid): 20–35×
- Eastern European mid-tier: 12–18×
कब use करें
Quick sorting, sanity check, off-market listing जिसमें expenses disclose नहीं हैं।
कब NOT use करें
बहुत अलग operating costs वाली properties की तुलना, below-market rents, commercial/multifamily।
Common mistakes
- Gross और net confuse करना।
- Monthly rent use करना instead of annual।
- Decision में cap rate को GRM से replace करना।
- Cross-market comparisons।
साथ pairs
- cap-rate, noi-calculator, rental-yield।