Concepts Definitions

• Gross Multiplier Method (Gross Rent Multiplier – GRM): An appraisal method that estimates the value of income-producing property by multiplying its gross annual or monthly rental income by a factor derived from the sales of comparable rental properties.
• Commercial Property: Real estate zoned and used for business purposes, such as restaurants, office buildings, or retail centers, which typically generate rental income.
• Residential Property: Real estate primarily used for living, encompassing single-family homes, condominiums, townhouses, duplexes, triplexes, and fourplexes; these can be rented to generate income.
• Apartment Buildings: Multi-unit residential properties, often with five or more units, specifically intended for generating income through rental payments from tenants.
• Public Buildings: Structures like government offices, religious institutions, or educational facilities that are used for public service or non-profit purposes and generally do not generate rental income.
• Cost Approach to Value: An appraisal method that determines property value by estimating the cost to construct a replacement, subtracting any accrued depreciation, and then adding the estimated market value of the land. This method is often used for properties that do not generate income or have limited comparable sales, such as public buildings.

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