Ch 15 The real estate market and analysis

Question 1

True or false, non-homogenous means that no two parcels are alike.

Answer 1

True

Question 2

True or false, highest and best use is fundamentally determined by alternate types of potential users bidding for a site in accordance with the locational and environmental value of the sit in each use.

Answer 2

True

Question 3

True or false, the definition of situs involves a buyer’s personal preference for location, accessibility, and features.

Answer 3

True

Question 4

True or false, a buyers market exists when there are more buyers (demand) then available real estate for sale.

Answer 4

False

A sellers market exists when there are more buyers (demand) then available real estate for sale.

Question 5

True or false, the entire property including building structures and the land are calculated into depreciation.

Answer 5

False

Land is durable and is not calculated into depreciation formulas.

Question 6

True or false, a physical characteristic of real estate is the fact that real estate is immobile. Simply put it doesn’t move.

Answer 6

True

Question 7

True or false,Demand for real estate is inverse to price. As the price comes down demand rises. As the price rises the demand goes down.

Answer 7

True

Question 8

True or false, real estate is generally quick to respond to changes in supply and demand.

Answer 8

False

Real estate is generally slow to respond to changes in supply and demand.

Question 9

True or false, there is a relationship between supply, demand and price. The more real estate that is available, the less demand there is for each individual parcel. Prices and turn go up.

Answer 9

False

Prices in turn go down

Question 10

True or false, when the mortgage credit market tightens up, let’s are able to qualify for a mortgage, increasing demand for houses.

Answer 10

False

It decreases demand for housing

Question 11

What are the factors that do not influence demand?

Availability of land

Price of real estate

Consumer tastes and preferences

Availability of mortgage credit

Answer 11

Availability of land

Question 12

The occupancy rate of Fred’s complex was 75%. There were 312 units. How many units were filled?

243
416
234
250

Answer 12

234

Question 13

Market indicators include all the following except:

Vacancy rates
Depreciation
Price/sales information
Building permits

Answer 13

Depreciation

Question 14

The economic characteristics of real estate include all of the following except:

There is no relationship between supply, demand, and price

The fact that the market is slow to respond to change in supply and demand

Demand driven by consumer preference

Supply driven by availability

Answer 14

There is no relationship between supply, demand, and price

Question 15

400 units are rented out of 450 total units. What is the occupancy rate?

89%
11%
72%
66%

Answer 15

89%

Question 16

The fact that land influenced by changes in the surrounding area describes?

Immobility of real estate

Indestructibility of land

Land is unique

Governmental control through zoning, building codes, taxes, etc.

Answer 16

Immobility of real estate

Question 17

Supply is described as:

How much real estate is available at any one time

Has no effect on price

Willing and able buyers and renters looking for property in a given area

Unrelated to pricing by having too many bidding on same property, or too few

Answer 17

How much real estate is available at any one time

Question 18

Which of the following is a physical characteristic of land?

Supply is driven by availability

The fact that demand is driven by consumer preference

The fact that real estate is non-homogenous

The fact that the market is slow to respond to change in supply and demand

Answer 18

The fact that real estate is non-homogenous

Question 19

Government controls influence the market to all the following except:

Limitations on how he property can be used

Standards for building size, placement and safety

Tax assessment affect purchase decisions

The value of a site in its current highest and best use

Answer 19

The value of a site in its current highest and best use

Question 20

Rusty managed an apartment building that had 25 total units. 20 of the units were rented. Calculate the vacancy rate.

80%
20%
75%
25%

Answer 20

20%

5 unoccupied units/25 total units = .2 or 20% vacancy rate