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Chapter One Flashcards

Introduction to Real Estate

1
Q

A(n) ______ is an order made by the Lieutenant Governor acting on the advice of the provincial Cabinet.

A

Order in council

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2
Q

What are the two main markets that registrants tend to specialize in?

A

The residential market and the Industrial, Commercial, and Investment market (IC&I).

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3
Q

A(n) ______ determines the market value of property based on its condition and the selling price of comparable properties that recently sold in the area.

A

real estate appraiser

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4
Q

A(n) _____ is someone who is authorized by a principal to represent him or her in business transactions with another party.

A

agent

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5
Q

Which piece of legislation embodies the bulk of provincial government regulation of the operation of the Saskatchewan real estate brokerage industry?

A

The Real Estate Act

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6
Q

The force that shapes the real estate market is the _____ by households, businesses, governments, and institutions for space and shelter for their activities.

A

demand

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7
Q

What is the legal term for the maximum interest or legal ownership a person may have in land?

A

fee simple

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8
Q

______ is the dollar amount invested today that is justified by the anticipated benefits, given risk and current investment conditions.

A

Capitalized value

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9
Q

In Canada, land ownership is vested in the ______, while private individuals only have certain rights granted at its discretion.

A

Crown (Aka - Federal and Provincial Government)

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10
Q

The ownership of a single parcel of real estate may be divided both _____ and _____.

A

physically; legally

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11
Q

What are the two essential parties involved in every real estate transaction

A

Buyers and sellers

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12
Q

Explain capitalized value

A

Capitalized value is the present worth of the benefits one expects to receive from the land in the future. It is the dollar amount someone is willing to invest today.

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13
Q

List the various participants in the Real Estate Industry

A

Buyers, Sellers, Real Estate Representatives, appraisers, Lawyers, Home and Property Inspectors, Real Property Assessors, Rental Property Managers, Condominium Managers, Borrowers, Lenders, Mortgage Brokers, Mortgage Insurers.

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14
Q

What is the definition of a Real Estate Representative

A

A person who is licensed under a provincial statute to provide real estate services to or on behalf of another, for expectation of renumeration.

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15
Q

What are some day to day functions/roles of a Real Estate Representative

A

Listing properties for sale.
Conducting open houses
Finding suitable properties for clients
Negotiating property prices
Drafting contracts
Presenting offers
Receiving deposits from buyers

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16
Q

Define “Agency”

A

“Agency” means that a real estate representative works on behalf of someone else—either the buyer or the seller or both—to help them with a real estate transaction. This relationship is based on an agreement where the representative becomes the “agent” for that specific transaction.

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17
Q

What is the function/role of an appraiser

A

To determine the market value of a property based on its condition and the selling price of comparable properties that have sold in the area.

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18
Q

What is the function/role of a Lawyer

A

A Lawyer will be retained to provide a variety of functions in a real estate transaction. These functions include; Drafting/reviewing the contract of purchase and sale, reviewing the property title, preparing closing documents, Explaining documents to clients, obtaining signatures for closing, collecting funds involved in the transaction, registering the transfer of the property and disbursing funds as instructed.

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19
Q

What is the function/role of a property inspector

A

Will conduct a comprehensive visual examination (Interior and exterior) of the properties overall structure and major systems and components (ie; plumbing, electrical, heating, roof, etc) and will provide a written report.

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20
Q

What is the function/role of a real property assessor

A

Works for SAMA (Saskatchewan Assessment Management Agency) to establish and maintain uniform real property assessments in accordance with the assessment act. It is used to determine the amount of property taxes to which a parcel of land is responsible.

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21
Q

What is the function/role of a Rental property manager

A

Manage repair, rental and maintenance activities. Required to be licensed under the Real Estate Act, unless exempt.

22
Q

What is the funciton/role of a Condominium Manager

A

Assist in the management of the condominium corporation and the maintenance of common areas and facilities, including the exteriors of the buildings.

23
Q

What is the function/role of a borrower

A

To obtain funds, often in the form of a mortgage, to finance the purchase of Real Estate or for other purchases, with the agreement to repay the borrowed amount to the lender, usually with interest

24
Q

What is the function/role of a lender

A

Someone who is willing to make mortgage funds available to borrowers. Can be a single person, a group of people, a financial institution, a mortgage investment company, or a government agency.

25
What is the function/role of a mortgage broker
They are specialists in mortgage financing and act as an intermediary bringing borrowers and lenders together; however they typically work for the borrower. They are often involved in finding financial arrangements that suit the buyers needs and financial capabilities, obtaining approvals and ensuring funds are available for closing.
26
What is the function/role of mortgage insurers
If a mortgage loan represents more than 80 percent of a properties value, borrowers must obtain mortgage loan insurance which protect the lender against default.
27
Who are the three mortgage insurers in Canada
CMHC (Canada Mortgage and Housing Corporation), Genworth Financial, and Canada Guarantee.
28
What does IC&I Stand for
Industrial, Commercial and Investment
29
What type of properties is the residential market made up of
Single family homes, Condominiums and residential land lots
30
What type of properties is the IC&I market made up of
Shopping centres, apartment buildings, hotels and industrial properties
31
What type of properties include elements of both residential and IC&I market
Farm properties and recreational properties (Rural real estate markets)
32
What is the typical price range in the residential market
From $10,000 to 2 Million or more
33
What is the typical price range for IC&I properties
from $500,000 to $100 million or more for a major development
34
What occurs more frequently, Residential sales or IC&I sales
Residential sales
35
What are the characteristics unique to real property
Immobility Durability Indivisibility of Services Divisibility of Ownership Uniqueness and Scarcity Externalities
36
What is Immobility
Land cannot be moved from one location to another. This means that the value of a property is highly influenced by its specific location
37
What is durability
Improvements made to land, such as buildings and utilities, are typically long-lasting. This durability implies that investments in real estate are often long-term.  
38
What is Indivisibility of Services
The services provided by a piece of land, such as shelter or space for business, cannot be divided. You can't use only a fraction of a building; you have to use the whole thing.  
39
What is divisibility of ownership
While the services are indivisible, the ownership of land can be divided among multiple parites.
40
What is uniqueness and scarcity
Each piece of land is unique, even if the only difference is its location. This uniqueness contributes to the scarcity of land, especially in desirable areas
41
What are externalities
The value of a property can be affected by factors outside its boundaries. These externalities can be positive, like the construction of a new park, or negative, like the opening of a noisy factory nearby.  
42
What is a broker/brokerage
A brokerage is a legal entity that is registered (i.e., licensed) to trade in real estate. It can be a sole proprietorship, a corporation, or a partnership. The registrants within a brokerage act as the brokerage’s representatives. In legal terms, the brokerage is considered the employer of the brokers, branch managers, associate brokers, and salespersons affiliated with it, and is therefore liable for their actions.
43
What is an agent
Someone who is authorized by a principal to represent that principal in real estate transactions with another party
44
What is a branch manager
Has the same education, experience qualifications and responsibilities as a broker. In addition to their management and supervisory duties they can also represent buyers and sellers in real estate transactions.
45
What is an associate broker
Has successfully completed the same education as a broker and currently holds the role and responsibility of an associate. They can also represent buyers and sellers in real estate transactions
46
What is a salesperson
A person employed, appointed or authorized by a broker to trade in real estate.
47
What is the SRA (Saskatchewan Real Estate Act)
The Real Estate Act is the provincial legislative framework for the real estate industry in Saskatchewan. It regulates both the individuals and companies involved in trading activity, as well as the trading activity itself. The main purpose of the legislation is the protection of the public.
48
What is the Saskatchewan Real Estate Commission (SREC)
It is the statutory body responsible for regulating the real estate industry in Saskatchewan
49
What are the main functions of the Saskatchewan Real Estate Commission (SREC)
Licensing real estate service providers.   Protecting the public interest.   Providing pre-licensing and post-licensing education for service providers.   Administering The Real Estate Act.
50
What is the Hierarchy of the real estate industry
Minister of Justice Superintendent of Real Estate Saskatchewan Real Estate Commission Individual Registrants

Real Estate as a Professional Career (12 decks)

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