Definition: A ratio of a property's sale price or value to a specified annual gross income measure, used to estimate value from comparable income relationships.
Example
A $600,000 sale with $75,000 annual gross income indicates a multiplier of 8; comparable income of $80,000 times 8 suggests $640,000.
Keep the distinction clear
Use the same income basis for the comparables and subject. A gross multiplier does not deduct operating expenses and is not a capitalization rate.
Related terms
Gross Rent Multiplier (GRM) · Capitalization Rate (Cap Rate) · Income Approach
Keep studying
Income Approach: NOI, Cap Rate, Property Value, and Cash-on-Cash Return
References: FREC Course II syllabus: investment concepts
Pronunciation (US): GROHS IN-kum MUL-tuh-ply-er (capitals show stress)
Pronunciation reference: Merriam-Webster
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