Gross Rent Multiplier (GRM) Calculator 2027
Calculate GRM 2027 — quick rental property screening: Price / Annual Rent. GRM 6-10 = good buy in most markets. Simpler than cap rate for initial filter.
GRM Formula
Price / Annual Gross Rent. Simplest rental metric. Ignores operating expenses (use cap rate for that). Quick filter for hundreds of listings.
GRM Benchmarks
8 or below: exceptional (rare in 2026). 9-11: good buy. 12-14: fair. 15+: overpriced unless major upside (rent increase opportunity, fix-and-rent).
GRM vs Cap Rate
GRM uses GROSS rent (before expenses). Cap rate uses NOI (after expenses). GRM faster for screening but assumes uniform expense ratio. Cap rate more accurate but slower.
Market-Specific Caveat
Hot markets (SF, NYC) often have GRM 18-25 because of expected appreciation. Rural buy-and-hold markets GRM 6-9 with no appreciation. GRM benchmarks vary by market drastically.
Source: nar.realtor commercial valuation, biggerpockets.com GRM analysis. Last updated: May 2026.
Frequently Asked Questions
What if rents go up?
Recalculate. GRM is point-in-time. Rising rent markets, today's GRM may overstate (rent will catch up). Stagnant rents, GRM stays put.
Why use GRM over cap rate?
GRM faster for screening — don't need expense details. Useful for quickly filtering 50 listings to 5 worth deep-dive. Cap rate then runs the 5.
Is GRM useful for STR?
Less so — STR income varies seasonally and by occupancy. Use ADR × occupancy × 365 as annual STR revenue, then GRM on that. Better to use cap rate for STR.