Gross Income Multiplier (GIM)

Multipliers like the Gross Income Multiplier in real property analyses are effectively the reciprocals of rates.  In other words you can divide a $ 30,000 annual income by a 10.0% capitalization rate (being $ 30,000 / 0.10 = $ 300,000) to convert an income into a value opinion or you can use its reciprocal (1 / 0.10), being a multiplier of 10.0 and calculate the same value opinion result (being $ 30,000 X 10.0 = $ 300,000).

A real property's Gross Income Multiplier (GIM) is the ratio of a it's sales price to it's annual gross rental income at the time of sale.  

It is important to note that Gross Income Multipliers should be derived correctly using the same type of market data from each comparable sale, and notably the income used to calculate the GIM should only be only rental income. 

Contact us with your questions or concerns regarding the gross income multiplier or regarding your specific appraisal assignment in Nevada at 1-702-568-6699.  We can also be e-mailed at grigdon@cox.net.  

Commercial Real Estate Appraisals in the Las Vegas & Henderson, Nevada Area.