Chapter 1: Introduction to the Real Estate Business

Question 1

Absentee Owner

Answer 1

A property owner who does not reside on the property and who usually relies on a property manager to oversee the investment.

Question 2

Appraisal

Answer 2

A supported, defended estimate of the value of property rights as of a given date.

Question 3

Business Opportunity Brokerage

Answer 3

The marketing and sale of a going concern operation. Florida requires that business brokers have a real estate license to market business opportunities.

Question 4

Comparative Market Analysis

Answer 4

An informal estimate of market value performed by a real estate licensee for the seller or buyer to assist in arriving at an appropriate listing or offering price.

Question 5

Dedication

Answer 5

A deliberate transfer of infrastructure by its owner for public use and accepted for such use by the public.

Question 6

Farm Area

Answer 6

A selected and limited geographical to which a sales associate devotes special attention and study.

Question 7

Follow-Up

Answer 7

A post closing communication initiated by a licensee to maintain customer contact and goodwill.

Question 8

Property Management

Answer 8

The process of directing, controlling, operating and maintaining real estate for a third party.

Question 9

Real Estate Brokerage

Answer 9

A commercial activity in which the sale, purchase, leasing, rental, exchange or management of real property is conducted by qualified and licensed individuals acting either for themselves or others for compensation.

Question 10

Subdivision Plat Map

Answer 10

The layout of a subdivision showing lots, roads and other infrastructure by the developer to a local government agency.

Question 11

USPAP

Answer 11

(Uniform Standards of Professional Appraisal Practice) - Rules and guidelines that must be followed by a professional conducting an appraisal.

Question 12

An individual that owns rental real estate in a location other than where they reside is known as:

Answer 12

Absentee owner

Question 13

Prior to constructing a subdivision, a developer must submit which of the following for approval to the local government:

Answer 13

Subdivision Plat Map

Question 14

The Florida state agency that is primarily involved with issues of real estate development on coastal lands is:

Answer 14

Department of Environmental Protection

Question 15

A supported, defended estimate of a property’s value as of a given date is known as:

Answer 15

Appraisal

Question 16

Laws enacted to protect the public health, safety, or welfare are established through authority known as:

Answer 16

Police Powers

Question 17

Sales associate Tom decides to focus primarily on selling properties located in his own residential neighborhood. He constantly reviews current information about past sales, present homes for sale, and tries to get new clients by sending them direct mail information about the availability of his services. Tom is developing sales and marketing skills through which type of procedure?

Answer 17

Farming

Question 18

All of the following are sources of funds available for mortgage lending, except:

    A     Life insurance companies
B	Commercial banks
C	Credit unions
D	Federal Reserve System

Answer 18

Federal Reserve System

Question 19

A local government acquires ownership of streets and other infrastructure (e.g. storm sewers) and thereafter becomes responsible for maintenance of those acquired items through the process of:

Answer 19

Dedication

Question 20

If an appraiser was paid on a percentage basis (for example, 1% of the appraised value), how could this result in a conflict of interest?

Answer 20

The appraiser might be more inclined to inflate the value of the property to increase the appraisal fee

Question 21

Which type of government is responsible for enacting zoning laws?

Answer 21

Local

Question 22

Is it permissible for a licensed sales associate to perform a CMA for a fee?

Answer 22

Yes, although it is usually performed as a marketing courtesy

Question 23

Builder Kathy buys a lot in Regatta Plantation subdivision and builds a single-family house according to plans and specifications she selects. After the house is completed, she sells it to someone who saw the “For Sale” sign posted in the front yard. This type of development/construction is known as:

Answer 23

Speculative

Question 24

A real estate counselor:

    A      Is typically paid on a commission basis
B	Must have a college degree to be qualified
C	Acts as a consultant by performing research 
            on the subject real property
D	Usually holds a broker's license

Answer 24

Acts as a consultant by performing research on the subject real property

Question 25

Uniform Standards of Professional Appraisal Practice (USPAP) must be adhered to when the appraiser prepares which of the following:

    A      Appraisal
B	Comparative Market Analysis
C	Survey
D	Investment Analysis

Answer 25

Appraisal