Chapter 1-3 Flashcards
what is brokerage?
bringing parties together in a real estate transaction
what is appraisal?
it is the process of estimating a property’t market value based on establishing methods and professional judgment
what is property manager?
a person or company hired to maintain and mange property on behalf of it’s owner
what is subdivision?
it is the splitting of a single property into smaller parcels
what is development?
involves the contraction of the improvements on the land
what is home inspections?
it is profession that allows practitioners to combine their interest in real estate with their professional skills and training in the construction trades
what is counseling?
this involves providing clients with come tent independent advice base on the sound profession judgment
what is auctioning buying or selling?
this uses an open and competitive bidding to transfer property.
what is are requirements auctioneers in IL?
they must be licensed in IL.
what is the largest organization?
National association of realtors (NAR)
what is a member of NAR called?
realtor
what does NAR prides themselves over?
member adheres to a code of ethics and dedicated to equal housing opportunity
what are the five categories of real property?
residential, commercial, industrial, agricultural and special purpose
what are the factors that affect supply of real estate?
labor force, construction cost, government controls and government financial polices
what is labor force and construction costs?
- a storage of skilled labor or building materials or an increase in the cost decrease the amount of new homes
- construction permit fees and high property transfer cost
what are the government controls and financial policies?
the federal reserve board establishes a discount rate of interest for the money it lens to its member banks. that rate has direct impact on the interest rates that banks charge to borrowers
what are government agencies?
the federal housing administration (FHA), and the department of veteran affairs (VA), also have impact by insuring or guaranteeing loans
What are factors that affect the demand for real estate?
population, demographics, employment and wage levels
what is land?
is the earth’s surface extending downward to the center of the earth and upward
what is real estate?
is defined as land at, above and below the earth’s surface, plus all things permanently attach to it
what are the bundle of rights?
possession, control, enjoyment, exclusion, disposition
what is personal property?
is all property that can be owned and that does not fit the description of real property
what are the two classes of plants?
- trees, perennial, shrubbery and grasses that do require annual cultivation are considered real property
- annually cultivation crops such as wheat, corn, vegetables and fruit
what are emblements?
are generally considered personal property. As long as annual crop is growing, it will stay with real property unless other provisions are made
what is custom in IL for farmland?
when farmland is sold, it customary for it to be transferred on march 1.
what is severance?
an item of real property can become personal property
what is annexation?
when personal property becomes real real property
what is fixture?
is person property that has been so affixed to land or building that by time it becomes real property
what is legal test of fixture?
did person who installed the item for it to remain permeant on the property or for it to be movable in the future?
What is method of attachment?
how permanent is the of method attachment? can the item be removed without causing damage to the surrounding property? is the item used as real property or personal property?
what is adaptation to real estate?
Is the being used a real property or personal property?
what is agreement to real estate?
have the parities agree in writing on whether the item is real or personal property? what does the contract say?
What is trade fixtures?
a special category of fixture includes property used in the course of business.
what is Cattle fixture?
an article owned by a tenant and attached to rented space or building or conducting business is trade fixture (chattel fixture)
what must happen with trade fixture?
it must be removed on before the last day the property is rented. the tenant is responsible for any damage caused by the removal of the trade fixture.
what is accession?
trade fixture that are not removed becomes the real property on the landlord. Acquiring the property in this way.
how do trade fixture differ from the other fixture?
fixture belong to the owner of real estate, but trade fixtures are usually owned and installed by a tenant for the tenant’s use.
fixture are considered a permanent part of the building, but trade fixture are removable. trade fixture may be attached to a building so they appear to fixtures but can be carefully removed.
What are the five economic characteristics of real estate?
- Scarcity 2. improvements 3. permanence of investment 4. location (situs)
what are the three physical characteristics of real property?
- immobility 2. indestructibility 3. uniqueness
what are seven sources of law?
- U.S constitution 2. laws passed by congress 3. rules of regulatory 4. state constitution 5 state statutes 6. local ordinance 7. common law
what practice real estate in IL is governed by?
Real estate license act of 2000 (the act)
What is apartment complexes?
are groups of portent building with any number of unit in each building
what are condo’s?
for people who security of owning property with the care maintenance a house demands
What a cooperative?
is similar to condo in that it also offer units with share common facilities
these owner don not won the unit, instead they buy shares of stock in corporation that holds the title to the building
what is PUD stands for?
Planned unit development
what is PUD?
sometimes called master-planned communities, merge such diverse land uses as housing
it is planned under special zoning ordinances. these ordinances permit maximum use of open space by reducing lot size and street areas.
what is retirement communities or active communities?
may provide shopping recreational opportunities, and health care facilities in additional to residential units.
What does MUDs stand for?
high rise development
what is high rise development?
combine such element as office space, stores, theaters and apartment units into single vertical community
what is converted use property?
are factories, warehouses, office buildings, hotels and ect
what are manufacture housing?
including mobile homes was considered temporary home, now with house parks making residential for low income houses.
What is modular housing?
as referred as prefabricated homes,
each room is pre assembled at a factory, driven to building site
what is time share?
allow many to sure ownership of a single property and each owner is able to the pretty for a period of time
what is PITI?
what you must pay when you own a home, PITE stands for Principal, Interest, taxes and insurance
what are tax benefits?
the homer may be able to deduct mortgage interest paid as well real estate taxes
what is tax benefit for married when selling a house?
500,000 is now excluded from capital gain tax for profit on the sale of principal residence
what is tax benefit for single person when sell a house?
250,000
how long are these tax benefits good for?
a lifetime
what is tax reconciliation act of 2006?
provides capital gain breaks. as it relate to homeownership, the tax rate for long term capital gain was reduced to 15 percent in 2003 through 2008
what is exchanges?
investor can defer taxes of capital gain by making exchange the owes will incur tax liability on sale only if additional capital or property is also received the is deferred. the owner will tax when the sale occurs
what is a boot?
any capital or personal property included in the transaction to even out the value of the exchange
what is tax deductions?
- real estate taxes (but not interest paid on overdue taxes
- mortgage interest payment on the first and second homes
- certain loan origination fees in the years of purchase
- loan discount points in the year of purchase
- loan prepayment penalties
what is homeowner insurance for?
lender usually require that homeowner obtain insurance when a dept is secured by the property
what is CLUE stand for?
comprehensive loss underwriting exchange
What is CLUE?
is database of consumer claim history that enable insurance companies to access prior claim information in the underwriting and rating process. the database contains up to five years of personal property claim history.
what is national flood insurance act of 1968?
it was to help owner of property in flood prone areas by subsidizing flood insurance
What is FEMA stand for?
federal emergency management agency
what is FEMA?
administers the flood insurance program
Who prepared flood maps?
Army Corps of Engineers
What must you do if your house in a flood plain?
you must flood insurance
