Question about GRMs

[Dominic Jones]

Good morning everyone. I want to address this question specifically to our lovely BP Podcast co-host @Brandon Turner who is also a big believer in the power of residential multi-families!

So, I'm reading the highly recommended book "Investin in Duplexes, Triplexes, & Quads: The Fastest ans Safest Way to Real Estate Wealth" by Larry B. Loftis and I'm currently reading the Part Two: Buying Section, Ch. 8 Valuation of your property.

I understand the GRMs and the GRM scale, but I was wondering if GRMs are another way to quickly help an investor evaluate the market as a whole?

For instance, in the book he gives examples of comparing just three properties per GRM. All different prices, two similar GRMs and one different that indicated greater appreciation.

Can the GRM be used to tell me (quickly & easily) if I'm currently looking at properties in a market w/ a higher appreciation or if I'm looking at a market with lesser appreciation and higher cash flow.

Is this a viable usage of the GRM as well?

Best,

Dom