Resources - Financial Terms

The Net Income Multiplier (NIM) is a factor used to estimate the market value of income-producing properties. It is equal to the market value of a property divided by the net operating income or NOI.

NIM = Market Value/Net Operating Income

Market Value = NIM * NOI

The net income multiplier and the cap rate are financial tools used to estimate the market value of income properties. The cap rate and the NIM produce identical results when estimating the market value of an income property since the net income multiplier is the inverse of the cap rate.