Chapter 4: The Listing Package & Breakdown of Listing Agreement

Question 1

A packet of forms an agent provides to the seller when taking a listing.

Answer 1

Listing package

Question 2

The amount of cash to be paid for a property on a given date in a fair and reasonable open market sale.

Answer 2

Market value

Question 3

This approach to valuation is one where the value is indicated by recent sales of comparable properties in the market.

Answer 3

Market data/Comparative approach

Question 4

This valuation method calculates the current cost of replacing or reproducing the improvement less depreciation, and adds the value of the land, which is never depreciated.

Answer 4

Cost approach

Question 5

This method of valuation is useful primarily in income-producing properties (like apartments).

Answer 5

Net income/Capitalization approach

Question 6

Only give legal or tax advice to your principals if you are a(n):

Answer 6

Attorney.

Question 7

This occurs when the broker represents both the seller and the buyer in a transaction, with the consent of both parties.

Answer 7

Dual agency

Question 8

The provision in a listing agreement that provides for a negotiated period (any agreed to time period) after the termination of a listing in which the listing broker may still be entitled to a commission.

Answer 8

Safe harbor clause

Question 9

This code says that appraisals must be ordered by third-party appraisal management companies, not loan or real estate brokers.

Answer 9

Home Valuation Code of Conduct (HVCC)

Question 10

The housing market situation where there is more inventory of homes for sale than purchasers, so the seller generally has to lower prices to compete with the numerous other listings available.

Answer 10

Buyer’s market

Question 11

The number of months’ supply of home listings “for sale” at a particular time.

Answer 11

Inventory (MLS)

Question 12

The housing market situation where there are fewer homes for sale, and, based on the law of supply and demand, the seller can ask for a higher price.

Answer 12

Seller’s market

Question 13

Which of the following is true concerning listing agreements?

a) Handwritten instructions takes precedence (priority) over preprinted instructions.
b) Preprinted instructions take precedence (priority) over handwritten instructions.
c) Handwritten and preprinted instructions have equal weight.
d) None of the above.

Answer 13

a) Handwritten instructions takes precedence (priority) over preprinted instructions.

Question 14

An agent is required to give a copy of the listing agreement to his or her principal:

a) at the time an offer is presented.
b) at the time the signature is obtained.
c) when the principal pays the commission.
d) all of the above.

Answer 14

b) at the time the signature is obtained.

Question 15

Which of the following forms is a part of the seller’s listing package?

a) Seller’s Advisory
b) Residential Listing Agreement
c) both a and b
d) none of the above

Answer 15

c) Both a and b

Question 16

Which of the following is true concerning the adoption of HVCC?

a) HVCC refers to Home Valuation Code of Conduct.
b) Appraisals must be ordered by third-party appraisal management companies.
c) As a result, AMCs are experiencing a tremendous growth.
d) All of the above.

Answer 16

d) All of the above.

Question 17

Exclusive listings require a:

a) definite end time.
b) definite date.
c) both a and b.
d) neither a nor b.

Answer 17

c) both a and b.

Question 18

The amount of cash or cash equivalent that is most likely to be paid for a property on a given date in a fair and reasonable open market transaction is referred to as:

a) market value.
b) fair guess value.
c) gross value.
d) net value.

Answer 18

a) market value.

Question 19

What type of valuation approach involves calculating the current cost of replacing or reproducing the improvement, less depreciation, and adding to the value of land?

a) Comparative approach
b) Cost approach
c) Capitalization approach
d) All of the above

Answer 19

b) Cost approach

Question 20

Which of the following can provide information needed to complete a Comparative Market Analysis (CMA)?

a) Multiple listing summaries
b) Other brokers
c) County records
d) All of the above

Answer 20

d) All of the above

Question 21

The “safe harbor” clause protects the:

a) broker
b) seller
c) buyer
d) all of the above.

Answer 21

a) broker

Question 22

Which of the following is TRUE concerning appraisals in California?

a) Sales agents are allowed to make professional appraisals.
b) Sales agents are allowed to make informal appraisals only.
c) Professional appraisers need not be licensed.
d) All of the above.

Answer 22

b) Sales agents are allowed to make informal appraisals only