Compute a property cap rate from NOI and value, and the gross rent multiplier from annual rent.
| Cap rate (%) | – |
| GRM | – |
Use this cap-rate calculator for a first look at an income property. Cap rate is NOI ÷ value; it is before debt. GRM is value ÷ gross annual rent. After-repair value (ARV) can be typed as value if you want the cap on a rehab target.
NOI is net operating income for a year (rent minus operating costs, before mortgage). Keep NOI, value, and rent in the same currency units.
NOI / year: Annual net operating income, before debt.
Value (or ARV): Purchase price, current value, or after-repair value.
Gross rent / year: Scheduled or trailing gross rent for the year, before vacancy and opex.
Cap rate (%): NOI as a percent of value.
GRM: Gross rent multiplier.
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