DSCRGross rent multiplier calculator
GRM is price divided by gross annual rent. Under about 8 is strong, over about 12 is weak. Lower means faster payback and usually better rental yield. Enter your numbers below.
Lower GRM = faster payback. A rough rule of thumb: under ~8 is often attractive in cash-flow markets, over ~12 usually signals weak rental yield. GRM ignores expenses and financing, pair it with cap rate and cash-on-cash.
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The GRM formula
GRM is the simplest rent-to-price screen. A GRM of 10 means the price equals 10 years of gross rent. Because it ignores expenses and financing, treat it as a first filter, then run the cap rate and cash-on-cash math.
GRM across the markets we track
Here is the gross rent multiplier for each of the 18 metros in the Investor Yield Index, using live Zillow price and rent figures. Only 12 of 18 sit under the ~12 line that usually marks a healthy screen, and only the cheapest clear the under-8 mark. That is the rate environment talking, not a flaw in these cities. The numbers below are live Zillow figures for illustration, not lender quotes.
| Metro | Price | Rent / mo | GRM |
|---|---|---|---|
| Birmingham, AL | $122,274 | $1,448 | 7.04 |
| Memphis, TN | $124,349 | $1,441 | 7.19 |
| Chicago, IL | $226,376 | $2,266 | 8.33 |
| Cleveland, OH | $146,863 | $1,461 | 8.38 |
| Tampa, FL | $236,141 | $2,018 | 9.75 |
| Indianapolis, IN | $186,505 | $1,553 | 10.01 |
| Kansas City, MO | $197,905 | $1,548 | 10.65 |
| Houston, TX | $209,756 | $1,639 | 10.66 |
| San Antonio, TX | $183,620 | $1,404 | 10.90 |
| Orlando, FL | $265,670 | $1,977 | 11.20 |
| Columbus, OH | $204,904 | $1,524 | 11.20 |
| Atlanta, GA | $257,196 | $1,840 | 11.65 |
| Charlotte, NC | $257,739 | $1,740 | 12.34 |
| Dallas, TX | $252,511 | $1,678 | 12.54 |
| Nashville, TN | $317,204 | $1,798 | 14.70 |
| Las Vegas, NV | $314,948 | $1,737 | 15.11 |
| Austin, TX | $303,942 | $1,635 | 15.49 |
| Phoenix, AZ | $330,995 | $1,742 | 15.83 |
GRM only screens rent against price. To see which of these markets actually cash-flow after expenses and debt, check the Investor Yield Index.
Common questions about GRM
How is GRM calculated?
GRM = property price ÷ gross annual rent. It tells you how many years of gross rent it takes to recoup the price (before expenses).
What is a good GRM?
Lower is better. Under about 8 is often attractive in cash-flow markets, and over about 12 usually signals weak rental yield. GRM ignores expenses, so confirm with cap rate before you commit.
How does GRM differ from cap rate?
GRM uses gross rent with no expenses and is a fast screen. Cap rate uses net operating income and is more complete. Use GRM to shortlist, then cap rate to decide.