Ace the Certified Apartment Manager (CAM) Challenge 2026 – Unlock Your Property Potential!

The gross rent multiplier (GRM) is a valuable tool in real estate for assessing the potential profitability of an investment property. It specifically relates to a property's market value in relation to its rental income. By calculating the GRM, investors and property managers can obtain a quick estimate of a property's value based on its gross rental income, thus helping them evaluate whether the property is a good investment opportunity.

The GRM is derived by taking the property's market value and dividing it by its gross rental income. For example, if a property has a market value of $500,000 and generates $50,000 in gross rental income per year, the GRM would be 10. This metric provides a simple way to compare the investment potential of different properties within similar markets.

In summary, option C emphasizes the GRM as a valuation metric for property investment, which aligns perfectly with its purpose of assessing market value in relation to rental income. This understanding aids investors in making informed decisions about their real estate investments.