Gross-Rent Multiplier Law and Legal Definition

Gross-rent multiplier is the ratio between the market value of rent producing property and its annual gross rental income. It is the method to estimate a property’s market value. Gross-rent multiplier is also known as gross-income multiplier. For some properties, gross rents may include funds that a landlord must spend on utilities, while the tenants of other buildings may pay for utilities themselves.

Gross-rent multiplier can also be used to measure for smaller investment properties. Gross-rent multiplier is an adaptation of the market approach which is useful in appraising rental properties such as apartments.[Coventry Towers, Inc. -vs- Bd. of Revision, 1982 Ohio App. LEXIS 12173 (Ohio Ct. App., Cuyahoga County Apr. 8, 1982)]