Gross rent multiplier calculator
Free gross rent multiplier calculator: enter price and gross annual rent to compute your GRM in seconds — built for CRE investors screening acquisitions.
Total acquisition price including any seller credits
Total annual scheduled rent before expenses — gross potential rent, not net
Gross Rent Multiplier (Purchase Price / Gross Annual Rent)
10.00x
A GRM of 10.00x — in the moderate range for income-producing CRE. Use GRM as a quick filter to compare against submarket comps, then underwrite the full NOI, cap rate, and DSCR before making an offer. GRM is a screening shortcut, not a substitute for a full underwrite.
Gross Rent Multiplier (Purchase Price / Gross Annual Rent)
10.00x
A GRM of 10.00x — in the moderate range for income-producing CRE. Use GRM as a quick filter to compare against submarket comps, then underwrite the full NOI, cap rate, and DSCR before making an offer. GRM is a screening shortcut, not a substitute for a full underwrite.
Where AI changes the answer
The Gross Rent Multiplier (GRM) is one of the fastest filters in commercial real estate — divide the purchase price by the gross annual rent and you have a single number to compare across deals in the same submarket in seconds. GRM = Purchase Price / Gross Annual Rent. A property priced at $2,000,000 with $200,000 in gross annual rent has a GRM of 10.00x. Lower GRM generally means more income per dollar of price; higher GRM can reflect a premium market, below-market rents, or appreciation priced in. **Where GRM falls short — and where AI flags the gaps:** GRM ignores operating expenses entirely. A property with a 7x GRM and a 60% expense ratio may produce less NOI than a 10x GRM property running at 35% expenses. AI can flag when a low GRM is masking problems: deferred maintenance, below-market rents about to roll, or a rent roll padded with concessions. These are patterns that show up in context — not in a single multiplier. GRM also ignores vacancy, debt structure, and capital requirements. Use it to screen, not to decide. Once a deal passes your GRM filter, move to the NOI Calculator, Cap Rate Calculator, and DSCR Calculator to underwrite the full stack. **What is a typical GRM by asset class?** For stabilized multifamily in secondary markets, GRMs commonly range from 8–12x (ESTIMATE). Gateway markets and Class A assets often trade at 14–18x or higher. Single-tenant NNN retail may have a very different range from multifamily — always compare GRM within the same asset class and submarket. These are ESTIMATES; validate against recent comparable sales data. Related tools: after filtering with GRM, use the NOI Calculator to model net income after expenses, the Cap Rate Calculator to benchmark the unlevered yield, and the DSCR Calculator to confirm lender coverage before making an offer.
Questions real estate teams ask
What is the gross rent multiplier and how is it calculated?
Gross Rent Multiplier (GRM) = Purchase Price / Gross Annual Rent. Gross Annual Rent is the total scheduled rent for all units at 100% occupancy for a full year — also called Gross Potential Rent. It is a pre-expense, pre-vacancy figure. For example, a property priced at $1,500,000 with $150,000 in annual gross rent has a GRM of 10.0x.
What is a good GRM for multifamily real estate?
GRM benchmarks vary significantly by market and asset class. Stabilized multifamily in secondary and tertiary markets often trades at 8–12x; Class A multifamily in gateway markets may exceed 15–18x. Lower GRM suggests more income per dollar of price, but may also signal higher risk (deferred maintenance, below-market-rate rents, or a less desirable submarket). These are ESTIMATES — always compare GRM against recent comparable sales in your specific submarket.
How does GRM differ from cap rate?
GRM uses gross rent (before expenses and vacancy) — it is the fastest filter but also the least precise. Cap rate uses NOI (net operating income — after all operating expenses and vacancy) and is therefore a more accurate measure of yield. Two properties with the same GRM can have very different cap rates depending on their expense ratios. Use GRM to screen quickly, then compute the cap rate for deals that pass your initial filter.
Does GRM account for vacancy or operating expenses?
No — GRM uses gross potential rent, which assumes 100% occupancy and ignores all operating expenses. It does not capture vacancy loss, property taxes, insurance, management fees, maintenance, or reserves. A property with a low GRM but high expenses can generate less NOI than a higher-GRM property with lean operations. Always follow a GRM screen with a full NOI and cap rate analysis before underwriting a deal.
More free CRE tools
- Deal X-Ray | Free AI Underwriting Analyst for Multifamily
Drop any multifamily OM into your Claude. It extracts the deal, rebuilds the math on conservative assumptions, surfaces the red flags a broker buried, and hands back a verdict in three minutes. Free. Your OMs never leave your Claude.
- Cap Rate Calculator for CRE Investors
Free cap rate calculator: enter NOI and property value to get your capitalization rate in seconds — built for CRE investors sizing up acquisition targets.
- DSCR Calculator for CRE Investors
Free dscr calculator: enter NOI and annual debt service to check your debt coverage ratio — built for CRE investors sizing lender-ready acquisitions.