Example
A fourplex listed at $600,000 brings in $5,000 a month, or $60,000 a year, so its GRM is $600,000 ÷ $60,000 = 10. A similar fourplex nearby at $540,000 with the same rent has a GRM of 9 and looks like the better buy. Because GRM ignores vacancy and expenses, the cheaper one could still earn less if its taxes are higher or its roof is at the end of its life.
In a listing it looks like…
Fourplex, all units leased. Asking $600,000. Gross scheduled rent $60,000 a year (GRM 10.0).
Good to know
Use GRM to sort a list of listings quickly, then check the survivors on NOI and cap rate, which count the costs GRM leaves out. Compare GRMs only between similar properties in the same market: a GRM of 10 means something different for a new building than for one with a 40-year-old boiler.
Plain English, not legal advice. Last reviewed September 29, 2026.