Chapter 1

Question 1

What is an Absentee Owner?

Answer 1

Property owner who does not reside in the property and who often relies on a property manager to manage the investment

Question 2

What is an appraisal?

Answer 2

The process of developing and communicating an estimate of a property’s value.

Question 3

What is an appraiser?

Answer 3

A state-certified or licensed individual that are hired to determine the value of a property when taken by eminent domain

Question 4

What is a broker’s price opinion (BPO)

Answer 4

A written opinion of the value of real property.

• Broker can charge a fee for bpo as long as it’s not labeled as a loan
• not an appraisal

Question 5

What is a business broker?

Answer 5

Real estate licensees who engage in the sale, purchase, or leasing of businesses

Question 6

What is business opportunity?

Answer 6

The sale or leasing of an existing business, including the sale of tangible and intangible assets

Question 7

What is a community association manager (CAM)?

Answer 7

An individual that holds a CAM license when the community association consists of more than 10 units and has an annual budget in excess of $100k.

• Not required to manage apartments, commercial property, or single-family dwellings.
• Only applies to mobile home parks, planned unit developments, homeowners association,cooperatives, timeshares, condos, & other residential units.

Question 8

What is a dedication?

Answer 8

The gift of land by an owner, in this case a developer, to a government body for public use.

Question 9

What is a subdivision plat map?

Answer 9

An engineer’s plan for land use superimposed on a map of the land to be developed.

Question 10

What is a farm area?

Answer 10

A specific area of a city and becoming an expert in that area

Question 11

What does farming an area consist of?

Answer 11

Maintaining data on each property, including when it was built, the sale history, typical marketing time, assessed value, the amount of property taxes, and so on.

Question 12

What is a target market?

Answer 12

Expertise in locating prospects

Question 13

What is a follow-up?

Answer 13

What a sales associate does for buyers and sellers after the sale.
- results in good reputation, future referrals, and word-of-mouth advertising.

Question 14

What is a multiple listing service (MLS)?

Answer 14

A database that allows real estate brokers representing sellers under a listing contract to share information about properties with real estate brokers who may represent potential buyers.

Question 15

What is a REALTOR ®️?

Answer 15

Real estate licensee who is a member of the NAR

Question 16

What is the NAR?

Answer 16

National Association of REALTORS

- promotes ethics and education in the real estate industry

Question 17

What is property management?

Answer 17

Professional service conducted by a person or company hired to maintain and manage property on behalf of property owners

Question 18

What does property management typically involve?

Answer 18

The leasing, managing, marketing, and maintenance of a property.

Question 19

What is a mortgage loan originator (MLO)?

Answer 19

Someone who is licensed to receive compensation for taking a residential mortgage application or negotiating the terms of a residential loan.
- real estate licensees cannot accept a referral fee from a lender unless they are licensed as an MLO

Question 20

What are the three categories of residential construction?

Answer 20

Speculative (spec) homes, custom, and tract homes