Gross Rent Multiplier (GRM) Calculator

GRM = property price / gross annual rent. Quick screening metric (lower is better).

Inputs

Result

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General calculation reads

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How to use this calculator

  • Enter price and gross annual rent.
  • Read GRM.

About this calculator

GRM is a quick comparison metric — how many years of gross rent would equal the purchase price. Lower GRM = more rent per dollar of price. Doesn't account for expenses (NOI is more rigorous), but good for initial screening of a market or quick deal sorting.

Frequently asked

What's a typical GRM?+
7-10 in strong cash-flow markets (Midwest, secondary cities). 12-18 in balanced. 20+ in appreciation-bet markets like SF and NYC.
GRM vs cap rate?+
GRM uses gross rent, cap rate uses NOI. Cap rate is more rigorous; GRM is a faster filter.
Why use gross instead of net?+
Speed. Computing NOI requires expense data; gross rent is on every listing. GRM lets you screen 100 properties in an hour.
Lower GRM always better?+
For cash flow yes; but very low GRM (< 6) often signals problem properties or bad neighborhoods. Verify NOI before going further.
Monthly GRM?+
Some investors use monthly: GRM_m = price / monthly_rent. A 100 monthly GRM = ~8.3 annual GRM. Pick one and stay consistent.

Related calculators

Cap Rate Calculator
Capitalization rate = NOI / Property Value × 100. Property's annual return excluding financing.
Cash-on-Cash Return Calculator
Annual pre-tax cash flow / total cash invested × 100. Measures return on actual money in.
NOI (Net Operating Income) Calculator
NOI = gross income − operating expenses. Excludes mortgage payments, capex, depreciation, and income tax.
1% Rule Calculator
Quick rental screening: monthly rent should be ≥ 1% of purchase price.
Rental Property ROI Calculator
Total return = (cash flow + appreciation + principal pay-down + tax benefit) / cash invested. The full picture.
50% Rule Calculator
Rule of thumb: operating expenses ≈ 50% of gross rent. Quick NOI estimator.

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