ch 19-21 Flashcards
what is the safe drinking water act (SDWA)
was originally passed by Congress in 1974 to protect public health by regulating the nation’s public drinking water supply. SDWA authorizes the US Environmental Protection Agency (EPA) to set national health-based standards for drinking water to protect against both naturally-occurring and man-made contaminants that may be found in drinking water
NYS does not regulate drinking water supplies (single family homes on well water). If there is a private well on the property, the homeowner or potential homeowner should be advised to have the water tested by a health or private laboratory at least once a year.
The inspectors who enforce the Sanitary Code test for bacteria, mineral content and water corrosiveness.
A major concern in drinking water is that highly corrosive water may have high levels of leads
what happens if termite damage or infestation of an area is confirmed
the area must be treated and any damages repaired. Termite treatments can only be performed by a person certified by the NYS Dept of Environmental Conservation (DEC). Chlordane is a chemical insecticide that was used for this type of application until it was banned in the early 1980’s because of its toxicity.
What is the Freshwater Wetlands Act of 1975
it protects wetlands. They provide habitat for plants and animals, they help to absorb and slow floodwaters, and they also absorb excess nutrients, sediment, and other pollutants before they reach rivers, lakes, and other water bodies
What are the problems associated with asbestos
relatively harmless in its original condition. If dust filters into the air, it can cause asbestosis, a chronic inflammatory medical condition that affects lung tissue . Asbestos exposure can also lead to lung cancer.
Asbestos materials can be repaired, enclosed, encapsulated or removed, depending on the circumstances
what are the problems associated with lead based paint
it is dangerous when it enters the bloodstream through ingestion or inhalation. Lead is known to cause difficulties during pregnancy, reproductive problems in women and men, high blood pressure, muscle and joint pain and other health problems (memory problems, seizures, confusion, and clumsiness)
what does the residential lead based paint hazard reduction act of 1992 do
sets procedures for disclosing the presence of lead-based paint when selling properties built before 1978. According to the regulations:
Sellers must disclose in writing any info about known lead paint in the home. If sellers have performed lead tests, they must share the test results. Disclosed in agent’s acknowledgment
Sales or lease contracts must give buyers or lessors up to 10 days to check for lead hazards. Home buyers or lessors are not requires to test for lead-but they must be given the opportunity to do so. This info must be obtained in a special addendum attached to the contract
Homer sellers or real estate agents must give home buyes or lessors a copy of the EPA publication “protect your family from lead in your home”
What is radon
it is a odorless, colorless, tasteless, and radioactive gas created in the ground where uranium and radium exists. In certain homes, it can build to dangerous levels. Of all the environmental hazards facing us, radon is the easiest to detect and mitigate.
2nd leading cause of lung cancer
Studies have shown that the health risks of radon are greater than those posed by other environmental problems, including hazardous waste sites and pesticides on food
Any homeowner can test for radon gas in his or her home simply and easily. The use of underground pipes and an exhaust fan can be used to reduce radon. Another basic means to reduce radon in a home is by sealing cracks and other openings in the floors and walls.
Can enter home through:
cavities in walls
joints in construction materials
gaps in suspended floors
What is a sick building
it is a building with high levels of contaminants. Exposure can result in multiple symptoms of sickness exhibited by the inhabitants who try to use them. Sick building syndrome symptoms include headache, lethargy, eye, nose and throat irritation, breathing problems, and skin irritation. Not permanent effects on people
what is mold
a fongus that grows under moist conditions and causes allergic reactions in some people. Allergic responses include hay fever-type symptoms, such as sneezing, runny nose, red eyes, and skin rash. There are mold testing kits available that homeowners can use to detect the different types of mold that may be growing in their home. disclose as latent defect
what is urea formaldehyde foam insulation (UFFI)
is a thermal material that is no longer used because of formaldehyde gas emission. Wallboard not a significant source of formaldehyde
what is polychlorinated biphenyls (PCBs)
are mixtures of synthetic organic chemicals with the same basic chemical structure and similar physical properties. PCBs have been shown to cause a variety of adverse health effects, including cancer in animals. Studies in humans also provide supportive evidence for potential carcinogenic and non-carcinogenic effects of PCBs
If PCBs are suspected to be present, the EPA or the NYS Dept of Environmental Conservation takes samples of groundwater and soil and tests them. If the samples are positive for PCBs, the soil is moved to special incinerators or landfills
What does the NYS Environmental Quality Review Act (SEQR) do
requires all state and local govt agencies to assess the environmental significance of all actions they have discretion to approve, fund or directly undertake
If action is determined to have possible significant adverse environmental impacts, an environmental impact statement (EIS) is required
what is the Comprehensive Response, Compensation, and Liability Act (CERCLA)
created a tax on the chemical and petroleum industries and provided broad Federal authority to respond directly to releases or threatened releases of hazardous substances that may endanger public health or the environment
Best known for its creation of the “Superfund”. The principle purpose for the Superfund is to clean up hazardous waste dumps and to respond to spills of hazardous materials
The Superfund amendments also created a concept called innocent landowner defense. This was based on the idea that in some cases a landowner in the chain of ownership could have been innocent of any wrongdoing and hsould not be held liable
What is the underground storage tank system (UST)
is a tank that has at least 10 percent of its combined volume underground. The greatest potential hazard from a leaking UST is that the petroleum or other hazardous substance can seep into the soil and contaminate groundwater. The EPA requires that any sites contaminated by a UST must be cleaned up. Regulated when storage capacity is above 1100 gallons
what are electromagnetic fields or EMF
are invisible lines of force that surround any electrical device. EMF are yet another invisible hazard. One draft study by the EPA acknowledged that low-level EMF may increase the risk of cancer. No laws that regulate
What is chlorofluorocarbons (CFCs)
are organic compounds that contain carbon, chlorine, and fluorine atoms. The most common commercial CFCs are marketed under the trade name Freon
CFCs have been identified as the major cause of ozone depletion in the upper atmosphere. In 1990, Congress added provisions to the Clean Air Act (CAA) for protecting the stratospheric ozone layer.
The 1990 Clean Air Act required EPA to set up a program for phasing out production and use of ozone-destroying chemicals. The act encourages the development of “ozone-friendly” substitutes for ozone-destroying chemicals.
It is critical that agents know the laws that pertain to property disclosure of environmental hazards and understand all the issues that may affect a property they are dealing with.
what is an appraisal
it is an unbiased estimate of the nature, quality, value or utility of an interest in or aspect of identified real estate and related personality as of a certain date
what is a valuation
is the process of estimating the value of an identified interest in specific property as of a given date. the purpose of valuation is largely to determine a property’s market value
what is investment value
is the amount of the return on an investment that an income-producing property will produce
what is the insured value
is the face amount a casualty or hazard insurance policy will pay in case a property is deemed unusable
what is use valuea
is the value the property holds for the owner. Contributing factors: Income Appreciation Use Tax benefits
What is the mortgage value
is the value the lender places on a property as collateral for the loa, especially in the event of a foreclosure when the lender must recover the debt through the sale of the property
What is the exchange value
the value that results from comparing the property to other similar properties on the open market. this is the type of value that real estate agents are concerned with
what is reproduction value
the value based on the cost of constructing a precise duplicate of the subject property’s improvements, assuming current construction costs
what is salvage value
the nominal value of a property that has reached the end of its economic life. Salvage value is also an estimate of the price at which a structure will sell if it is dismantled and moved
what is assessed value
the value of a property as estimated by a taxing authority as the basis for ad valorem taxation
what is condemned value
the value set by a county or municipal authority for a property which may be taken by eminent domain
what is depreciated value
it is a value established by subtracting accumulated depreciation from the purchase price of a property
what is rental value
an estimate of the rental rate a property can command for a specific period of time
what is evaluation
is a study of the nature, quality, or utility of certain property interests in which a value estimate is not necessarily required
evaluation of a property does not result in an estimate of value. Evaluation looks at a number of economic principles that influence the value of a property
what is anticipation
the benefits a buyer expects to receive over the period of time he or she has the property influences the decision to purchase it. The value of the property can increase or decrease depending on whether the anticipated change is a benefit or disadvantage. For ex a buyer hears the property down the street may become a shopping mall. Is that a benefit or disadvantage? It may depend on the buyer’s viewpoint
what is assemblage
when two adjacent pieces of property are joined together, the value of the one larger parcel may be greater than the value of the two separately. For ex, two lots are valued at $25k each, but when combined for one use, they have a value of $60k. The extra value created by merging the two parcels is called plottage value
what is change
both market conditions and a property’s physical condition change constantly over time. These changes affect the benefits of the property. Using our shopping mall ex is the construction of a mall benefit or a detriment to the property’s value? An appraiser needs to keep abreast of these types of changes
what is conformity
this principal says that a property is at its highest value when it conforms with and fits into its surroundings. If a three-bed, one-bath home is in a neighborhood where all the homes have two-baths, it might be wise for the owner to consider installing a second bath
what is competition
this principal holds that when several businesses of a similar type are close to one another, together they may make more money than they would have individually. For ex several fast food chain restaurants located on the same major street attract more buyers than one fast food restaurant would if it sat by itself
what is contribution
this is what the market recognizes as the change in value an improvement makes to a property, rather than what that improvement actually cost. A remodeled kitchen might ass $50k to the value of a home, while the actual cost could have been anywhere from $25k to $75k
what is diminishing return
this condition is a result of continuing to add improvements to a property when those improvements will have no effect on increasing the value of the property
what is highest and best use
according to this principle, every property has a single use which produces the greatest income and return. Therefore the property will have its highest value when it is used for that purpose . the property’s use must be
Legally permissible
Physically possible
Financially feasible
Maximally productive
For ex an old office building may not be in its highest and best use if it’s located in a downtown area that is undergoing residential redevelopment. Its best use might be a conversion to high end condo units
What is progression and regression
this principle holds that a property is affected by the surrounding properties the value of the smallest house on the block will tend to increase if the other homes on the street have more value (progression). On the other hand, the value of the largest home on the block may decrease if the other homes on the street are much lower in value (regression).
what is substitution
according to this principle a buyer will not pay more for a home than what he or she would pay for another home that is equally attractive and available
what is market value
is the most probable price as of a specific date, in cash, or in terms of equivalent to cash, or in other precisely revealed terms, for which the specified property rights should be sold after reasonable exposure in a competitive market under all conditions requisite to fair sale, with the buyer and seller each acting prudently, knowledgeably and for the self interest and assuring that neither is under undue duress.
Is an opinion of the value of a property based on analyzing data collected about the property
what is the market price
is an amount a particular purchaser agrees to pay and a particular seller agrees to accept under the circumstances surrounding the transaction, in other words the actual sales price
what is a comparative market analysis (CMA)
is not an appraisal. A CMA is done by a listing agent to give the seller info about the sales prices of similar homes, so that the seller can decide how much to ask for the property. According to the principle of substitution a buyer will not pay more for a home than what he or she would pay for another home that is equally attractive and available
To do a CMA must do the following:
Collect and analyze info about the seller’s property
Choose comparable properties in the area
Compare the seller’s property to the comparable and do some adjusting to the value of the comparables
Estimate a reasonable and realistic selling price for the seller’s property
Should focus on:
The neighborhood
The home site
Existing property improvements
what are direct costs or hard costs
this includes the cost of labor and materials
what are indirect costs
these are costs that support a given project. Including: Administration costs Appraisal fees Architectural and engineering fees Attorney's fees Filing fees Financing fees Interest Leasing costs Recording fees Surveyor fees Taxes during contruction
what are three approaches to estimating value that appraisers use
Sales and comparison approach
Cost approach
Income approach
what is the sales and comparison approach
is based on the principle of substitution. With this approach, the value is determined by comparing the property being appraised with recently sold comparable properties. The sales comparison approach is believed to be the most reliable for appraisals of single family homes
Is based on the principle of substitution- which says that a buyer will not pay more for the subject property than he or she would pay for a property that is similar in characteristics and amenities
This approach the value is determined by comparing the property being appraised with recently sold comparable properties.
He makes adjustments to the comparables by either adding value or deducting value.
Bases adjustments on date of sale, location, physical characteristics, transaction characteristics, sale condition
what is the cost approach
is most reliable for properties that were built recently, since the appraiser can get access to the actual costs of the development and construction. It’s also a good approach for special purpose buildings when data on income is not available or there are no comparable sales. The cost approach attempts to estimate either the property’s replacement cost or reproduction cost
what is the income approach
used to estimate value of properties that produce income usually from rent. The approach assumes that an investor will purchase a property based on the future income stream the property will produce- the principle of anticipation. This approach also assumes that an investor will not pay any more for a tax property with a certain income than he or she would pay for a similar property with a similar income- the principle of substitution.
- Estimate the potential gross income. Is the potential rent scheduled to be collected on the property plus income from such other sources as laundry etc. The scheduled rent is the amount of rent the property will collect if it is fully leased at the current rental rates. An appraiser should also use market studies to estimate the rental income, since the current rent for a particular property may not reflect the current rates of the market in general.
- Estimate the effective gross income. An appraiser calculates effective gross income by subtracting vacancy and credit loss from potential gross income. Vacancy losses are the amount of income lost because of space that’s not rented. Credit losses are the result of tenants not paying the rent. The appraiser estimates vacancy and credit losses based on the property’s history and other properties in the market that are comparable.
- Estimate the net operating income. An appraiser arrives at net operating income by deducing annual operating expenses from effective gross income. Operating expenses can be both fixed and variable.
Fixed expenses include items such as taxes insurance-those items that are not affected by the presence or absence of rentors.
Variable expenses relate to actual operating expenses, such as utilities and repairs.
Note the mortgage is related to the debt on the property, so mortgage payments are not operating expenses. - Select a capitalization rate
what was the civil rights act of 1866
prohibited discrimination in housing based on race
Fair Housing Act of 1968-added color, religion, and nation origin
Housing and community Development Act in 1974-added sex
The Fair Housing Amendments Act in 1988-added handicap and familial status
what happens if feel discriminated against
may file a complaint with the HUD within 1 year of alleged act. In addition to or instead of filing a complaint with HUD, a person may file a suit in a state or fed court within in 2 years of the alleged violation
what are 2 steps brokers should take to ensure compliance with fair housing laws
- Prominently display in all offices the Equal Opportunity Poster that HUD distributes
- Provide ongoing training and education to all affiliated licensees by holding seminars and workshops , watching videos and bringing in guest speakers
describe the exemption that exists for familial status discrimination
Housing for older persons is exempt if one of the following conditions exists:
HUD Secretary has determined that it is specifically designed for and occupied by elderly persons under a federal, state, or local govt program
It is occupied solely by persons who are 62 or older
It houses at least one person who is 55 or older in at least 80 percent of the occupied unites, and adheres to a policy that demonstrates the intent to house persons who are 55 or older
what does the American with Disabilities Act (ADA) in 1992 mandate
that persons with disabilities have equal access to jobs, public accommodations, govt services, public transportation and telecommunications. Since most real estate firms are public places, brokers should evaluate how this applies to physical changes they might need to make to their office space to accommodate both employees and clients
Article 15 of the NYS Human Rights Law prohibits what
discrimination in employment, housing, credit, places of public accommodations, and educational institutions. In addition to the classes protected under the federal laws, NY has added other protected classes: Age Marital status Military status Sexual orientation
The NYC Human Rights Law does..
is one of the most comprehensive civil rights laws in the nation. The NYC Commission on Human Rights has identified three other protected groups:
Alienation or citizenship status
Lawful occupation
Partnership status
what are some discriminatory activities
refusing to sell, rent or negotiate with any persons who is a member of a protected class Fair Housing Laws prohibit these activities: Blockbusting- making a profit by inducing owners to sell by telling them that persons of protected class are moving into the neighborhood which will have detrimental results Steering- channeling homebuyers toward or away from homes in certain neighborhoods in order to preserve or alter the makeup of that neighborhood Redlining- restricting the number of loans in certain areas of a community because of its racial or ethnic makeup. Compliance with anti-discrimination laws is critical when doing advertising
what are testers
fair housing groups created testers to uncover housing discrimination. Testers with similar profiles and housing needs but different in their protected class status (race/sex) visit a real estate office and ask to see the same available unit to ascertain if they are treated differently because of this protected class status
list 3 activities that are considered discriminatory in real estate
refusing to sell, rent, or negotiate with any person who is a member of a protected class
Telling persons that a property is not for sale or rent when it is
Denying membership in any multiple listing service (MLS) or any broker’s organization
violation of fair housing laws carry penalties and fines
A non-solicitation order is a directive to all real estate brokers and real estate salespersons to refrain from soliciting listings for the sale of residential property within a designated geographic area
A property owner within an established cease-and-desist zone can file a cease-and-desist notice with the Dept of State indicating that they do not desire to sell, lease or list their residential property and do not desire to be solicited to sell, lease or list their residential property
What was the significance of the Plessy v. Ferguson Supreme Court decision of 1896?
This Supreme Court decision allowed the use of “separate but equal” racially-segregated accommodations and facilities. In other words, as long as separate housing for blacks and whites were judged to be equal, they were legal.
Alex Jones owns a duplex and lives in one unit. He refuses to rent the other unit to families with children. What would you say about Alex’s actions?
Alex is within the guidelines of the New York fair housing law since he is the owner of a two-family dwelling, one of which is owner-occupied.
In a process known as ___________, dwellings that were formerly occupied by middle- and upper-income families decline in quality and value and become available to lower-income families.
filtering down
Testing for fair housing compliance must
be recognized as a risk and a cost of doing business.
1 of 12 - Which New York State agency handles discrimination complaints?
Division of Human Rights
