what are CAP rates or Gross Rent Multipliers for small income properties with a sales price of 2.5 million

Anna27
Home Buyer
Los Angeles, CA

in the marina del rey area

Answers (2)
Lawrence Walsh
Agent
Los Angeles, CA

Typically if you're dealing with a small residential income property (2-4 units), you would use the Gross Rent Multiplier (GRM) to determine overall value of a property based on gross market rents of similar units in the area. Generally in Los Angeles city, becasue of rent control restrictions, or high percentages of owner occupied units, the GRM method is given secondary weight to the sales comparison approach in determining market value, even for 2-4 unit properties.

Wed Aug 5 2009, 21:50
Dorene Slavitz
Agent
Culver City, CA
FIRST ANSWER

Put simply, the cap rate is the net operating income divided by the sales price. It is not possible to calculate the cap without all the information.
Dorene Slavitz
Residential & Commercial Realty

Sat Jun 21 2008, 20:48

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