Let’s analyze the numbers step by step ��
��️ Given:
Purchase Price: $5,695,000 Annual Gross Income: $624,600 Annual Property Taxes: $26,250 Annual HOA: $17,598
�� Step 1: Gross Rent Multiplier (GRM)
➡️ A GRM around 9 is solid, depending on the market. Lower is better (means higher
income per dollar invested).
�� Step 2: Net Operating Income (NOI)
Subtract property taxes and HOA (not including mortgage payments yet):
�� Step 3: Cap Rate
➡️ A 10.2% cap rate is very strong for residential investment properties in most
markets.
Typical cap rates range from 5–8% depending on location and risk.
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