Chapter 1: basic Real estate concepts Flashcards
what is Real property?
Is defined as the Land and everything that is permanently attached to the land, that is appurtenant to (or goes with) the land.
- the land itself
- the improvements thereon.
- and the interests, benefits, and rights inherent in the ownership of real estate.
what is Personal property(personalty)?
is considered to be all property that does not fit the definition of real property.
- Also referred to as chattel.
- furniture,clothing, money, bonds, and bank accounts.
What is Land?
- Is defined as the earth’s surface extending downward to the center of the earth and upward to infinity;
- including things permanently attached by nature, such as trees and water.
What is Real Estate or realty?
- is defined as land, at, above, and below the earth’s surface;
- including all things permanently attached to it whether natural or artificial.
What are the Physical and Economic Characteristics of Real Property?
Real Estate-
Economic Characteristics:
- Scarcity
- Location
- Improvements
- Permanence of Investment
Physical Characteristics:
- Immobility
- Indestructibility
- Uniqueness
What is Highest and Best Value?
-Is the use that will give the owners he greatest actual return on their investment.
what are Land-Use Controls?
Land use laws that are set in place so that commercial properties can’t be built in residential areas and vice versa.
What are the advantages of Real Estate Investment?
- if held onto long enough the rate of return can be great.
- If purchased for well below market value a flip can bring a greater return.
- real estate entrepreneurs may enjoy various tax breaks.
what are some Disadvantages of real estate investment?
- Real estate is not a liquid asset.
- The investment usually can not be sold quickly without taking a monitory loss.
- The economy can play a large role on whether a real estate property will increase or decrease in value and can decrease in value during the period in which the investor possesses it.
what is a broker?
is an agent who negotiated the sale, purchase, or rental of property on behalf of others for a fee or commission.
What is a provisional Broker?
- Is a probationary like status in which a real estate broker-in-charge supervises any real estate activities.
- provision is lifted as soon as 90 additional hours of schooling are completed.
what is supply and demand in real estate?
- supply: Increases, price drops, as more producers compete for buyers.
- demand: increases, prices rise as more buyers compete for the product.
What are the 5 uses of Real Property?
- Residential- all property used for housing, from acreage to small city lots, both single-family and multifamily, in urban suburban, and rural areas.
- Commercial- business property, including offices, shopping centers, stores, theaters, hotels, and parking facilities.
- Industrial- warehouses, factories, land in industrial districts, and power plants.
- Agricultural- Farms, timberland, ranches, and orchards.
- Special Purpose- Churches, schools, cemeteries, and government-held lands.
What is a Market?
is a place where goods are bought and sold;
- where value for those goods is established;
- where it is advantageous for buyers and sellers to trade.
what are factors that affect supply?
- Labor force and construction costs
- A shortage of labor in skilled building trades;
- an increase in the cost of building materials
- or a scarcity of materials;
Tends to decrease the amount of housing built or increase the cost.
Government Controls and financial policies:
- the governments monetary policy can have a substantial impact on the real estate market. (effects interest rates.
- local level real estate policies can impact the market negatively or positively depending on the new policies.
- Local level can also cause problems with land-use control policies.
