## Step 1

#### Step

Determine the annual gross rent multiplier of properties that are similar to yours and have recently sold in the same area as the property you want to value. You can often find GRMs published by brokerage firms in research reports for a particular market area. Or you can contact a local appraiser or brokerage firm and ask for the average GRM for a particular property type in an area. For the following example, use a GRM of 8.2 to value an apartment building.

## Step 2

#### Step

Determine the total monthly rental income of the occupied units of property you want to value. In the example, use a monthly rental income of $8,000.

## Step 3

#### Step

Multiply the monthly rental income by 12 to determine the annual gross rental income. In the example, multiply $8,000 by 12, which equals $96,000.

## Step 4

#### Step

Determine the number of vacant units, if any, of the property you want to value. In the example, use two vacant units.

## Step 5

#### Step

Determine the monthly market rental rate per unit of the vacant units. You can estimate this by using an amount similar to current rental listings of similar units in the area. In the example, use $1,000 as the monthly market rental rate per vacant unit.

## Step 6

#### Step

Multiply the number of vacant units by the monthly market rental rate per vacant unit, and multiply the result by 12 to determine the potential annual rental income from the vacant units. In the example, multiply 2 times $1,000 times 12, which equals $24,000.

## Step 7

#### Step

Add your result to the annual gross rental income from the occupied units. In the example, add $24,000 to $96,000, which equals $120,000. This is the potential annual gross rental income of the property.

## Step 8

#### Step

Multiply the GRM by the annual gross rental income. In the example, multiply 8.2 by $120,000, which equals $984,000. This is the estimated value of the apartment building based only on its rental income.