Final answer:
The gross rent multiplier for a single-family home is calculated by dividing the sales price of the property by the annual gross rental income it generates.
Step-by-step explanation:
The gross rent multiplier for a single-family home is calculated by dividing the sales price of the property by the annual gross rental income it generates. The formula is:
Gross Rent Multiplier = Sales Price / Annual Gross Rental Income
For example, if a single-family home is sold for $300,000 and generates an annual rental income of $30,000, the gross rent multiplier would be:
Gross Rent Multiplier = $300,000 / $30,000 = 10