Metrics
GRM (Gross Rent Multiplier)
Property price ÷ annual gross rent. The simplest screening ratio in real estate — no expense data required.
6–10 is healthy in cash-flow markets. 10–14 is balanced. 14–20 is appreciation territory. 20+ is luxury / ultra-coastal.
How it's calculated
GRM = Property Price ÷ Annual Gross RentExample
A $300,000 property renting for $2,500/mo ($30,000/yr) has a GRM of $300,000 ÷ $30,000 = 10.0.
Why GRM (Gross Rent Multiplier) matters
GRM is the fastest triage filter there is — you can compute it from a listing price and a rent estimate alone, with zero expense data. Lower is better. Use it to shrink a 200-listing search down to the 20 worth underwriting properly.
Related terms
Cap Rate
Net Operating Income ÷ property value. The unleveraged return a property generates, independent of f…
1% Rule
Rule of thumb: monthly rent should equal at least 1% of purchase price. A 5-second screening filter,…
NOI (Net Operating Income)
Gross annual rent minus all operating expenses, before debt service and income tax.
Ready to run the GRM (Gross Rent Multiplier) math on a real deal?
Free 60-second analysis with labeled starting assumptions and no signup. Pro calculates your Offer Ceiling: the highest price that still meets your targets under the assumptions shown.
Where GRM (Gross Rent Multiplier) shows up in TrueCap
The analyzer computes this metric on every run from the assumptions you see and can edit, shows it in the results view beside cash flow after reserves and DSCR, and uses your targets for it in Buy Box fit and in the Offer Ceiling — the highest price that still meets those targets. It appears in the written decision memo and the PDF with the same value and the same inputs.