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Basic Appraisal Principles > Course Review Quiz > Flashcards

Course Review Quiz Flashcards

1
Q

The ___ has oversight authority over state appraisal boards:

  1. AQB
  2. ABC
  3. ASC
  4. HUD
A

ASC.

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2
Q

Which is not true concerning the highest and best use of land as though vacant?

  1. it could be to leave it vacant
  2. it could be for projected development
  3. this analysis can only be applied if there are no existing improvements
  4. it could be the existing use
A

This analysis can only be applied if there are no existing improvements

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3
Q

Real Estate includes all of the following except:

  1. land
  2. buildings
  3. property rights
  4. trees
A

Property rights. Property rights are part of real property, not real estate

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4
Q

The ownership interest held by the lessor, which includes the right to receive the contract rent specified in the lease plus the reversionary right when the lease expires is the definition of

A

Leased Fee Interest

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5
Q

All of the following could be participants in a real property market except:

  1. Sellers
  2. Landlords
  3. Appraisers
  4. Assessors
A

Assessors

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6
Q

In analyzing real estate purchase contract, you should be able to find all of the following items except

  • sale price
  • legal description
  • date of sale
  • amount of property taxes
A

Amount of property taxes

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7
Q

Your property, which consists of a house and lot, is valued at $244,000. You want to insure it for 80% of value and the annual insurance premium will cost $5.75 per thousand. How much will your insurance cost per month?

A 
$93.53
244,00 x .8 =195,200
195,200 x 0.0575 =11,224
11224 divided by 12 (months) = 935.33
Carry decimal to the left one place. 
$93.533
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8
Q

In appraisal, the concept that a higher-priced property will be worth less in a lower-priced neighborhood than it would in a neighborhood of comparable properties” is the definition of the principle of

A

Regression

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9
Q

You want to buy a house for $243,500. You can get a loan for 90% of value. You will also have to pay 2.75 points on the loan. How much will you have to deliver to closing to cover both the down payment and the loan points?

A 
$30,376.63
(1 mortgage point=1%)
243,500 x .90 = 219,150
219,150 x 0.0.275= 6,026.63
down payment = price- loan
243,500-219,150= 24,350
down payment + loan points
24,350 + 6,026.63 = 30,376.63
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10
Q

“Trespassing on the domain of another” is the definition of

A

Encroachment

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11
Q

All of the following would be social influences on value EXCEPT

  • Age of residents
  • Educational facilities
  • Family formations
  • Population trends
A

Educational facilities

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12
Q

“A firm agreement to perform an act, refrain from acting or make a payment or delivery” is the definition of

A

Promise

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13
Q

All of the following would be considered to be economic influences on value EXCEPT

interest rates
zoning
unemployment rates
Consumer Price Index

A

Zoning

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14
Q

Which of these factors would result in a violation of USPAP if the appraiser based his or her appraisal fee on it?

the appraiser’s value opinion
the borrower’s estimate of value
the square footage of the home
none of these

A

The appraiser’s value of opinion

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15
Q 
Which is NOT an economic force affecting property values?
wage rates
transportation
expense levels
Consumer Price Index
A

Transportation

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16
Q

“The right to construct and maintain tunnels, subways, subcellars, pipelines, sewers, etc.” is the definition of _________ rights.

A

Subsurface

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17
Q

Here are all the sales in your area in the last 4 months. They sold for: $178,500; $166,000; $172,750; $182,000; $168,000; $174,000; $176,000; $184,000; $170,000; $175,000; $172,000; $181,500. What is the mean sale price?

A

$174,979

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18
Q

A facade easement is a type of_______________ easement.

A

Historic Preservation

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19
Q

Electronic Data Interchange for transmitting appraisal reports became popular in the (date)

A

Late 1990’s

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20
Q

You have found comparable sales of rural land parcels that indicate the following sale prices per acre: ($930, $775, $1202, $995, $1612, $906). What is the median of these indications?

A

$962.50

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21
Q

USPAP includes performance standards for the appraisal of

A

real property, personal property, and business/intangible property

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22
Q

What is the mode of the following set of gross rent multipliers? (95, 93, 120, 94, 93, 129)

A

93

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23
Q

“A right or interest in property” is a(n)

A

Estate

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24
Q

The median price of homes sold in your county nine months ago was $217,400. Prices have been increasing at the rate of 8% per year. What is the median price of homes today?

A 
$230,444
8% (8 IN CLAC) per year ÷ 12 months = .667-> Rounded .67.
9 months X .67 = 6.0%
$217,400 X .06 = $13,044
$217,400 + 13,044 = 230,444
OR 
217,400 x .08= 17392
17,392 / 12 = 1,449.333
1,449.33 x 9 = 13,044
13,044 + 217,400 = 230,44
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25
Q

Which of the following types of investments has historically generated the highest return on investment?

real estate
savings account
money market fund
certificate of deposit

A

Real Estate

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26
Q

A(n) __________ contract is one that is not been fully performed or completed.

A

Executory

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27
Q

Mary Jones has a property with no road frontage. She has an access right of way across the property of her neighbor Bob Smith for ingress, egress, and regress. Who has the dominant tenement in this situation?

A

Mary Jones

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28
Q

What is the mean of these numbers: 123.5, 136.2, 162, 188.9, 153.27, 227.98, 16, 342.66, 72.7, 21.55, 168.08?

A

146.62

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29
Q

The Federal Reserve can influence the level of economic activity by

  • regulating the availability of money
  • regulating the rate of interest
  • neither of these
  • both of these
A

Both of these

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30
Q

When appraising an income producing property, you have the following GRMs indicated from comparable sales (122, 159, 132, 126, 122, 173, 152, 126). What is the mean of the GRMs?

A

139

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31
Q

The appraisal standards and qualification criteria promulgated by the boards of The Appraisal Foundation achieves legal authority by adoption, citation or implementation by

government agencies
the U.S Congress only
Fannie Mae and Freddie Mac
Ginnie Mae

A

Government Agencies

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32
Q

The price expected for a whole property, e.g., a house, or a part of a property, e.g., a plumbing fixture, that is removed from the premises usually for use elsewhere” is the definition of ____________ value.

contributory
business
salvage
going concern

A

Salvage

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33
Q

Property Owner A has the right to develop his property into 10 lots. He sells this right to nearby Property Owner B who wishes to develop his property into additional lots. This is an example of

  • transferable development rights
  • easement in gross
  • subsurface rights
  • easement appurtenant
A

Transferable Development Rights

34
Q

In the 1970s, who developed uniform rules for mortgage underwriting?

  • FIRREA
  • professional appraisal organizations
  • the Appraisal Subcommittee
  • Fannie Mae and Freddie Mac
A

Fannie Mae Freddie Mac

35
Q

Which entity is responsible for making periodic changes to USPAP?

  • Appraisal Standards Board
  • Appraiser Qualifications Board
  • Appraisal Practices Board
  • Appraisal Subcommittee
A

ASB. Appraisal Standards Board

36
Q

You apply for a mortgage. The lender will allow you to spend up to 28% of your annual income for housing costs, including your mortgage, property taxes, and insurance. Your income is $1,472 every two weeks. If you apply for the loan, how much can your maximum monthly payment be?

A

52 weeks in a year divided by 2 is 26.
1,472 x 26 = 38,272
38,272 x .28 = 10,716,16 (28% of the annual income per yr)
10,716 divided by 12 (months) =893.01 monthly payments

37
Q

Demand analysis in a market indicates that 15 houses per month can be sold in the market. There are currently 180 houses for sale in this market. How many months’ inventory does this represent?

A

12

38
Q

A lot measures 178 feet by 464 feet. It sold for $80,000. What did it sell for per acre? HINT: Round the acreage amount to two decimal places

A 
43,560 sq feet = 1 acre
178 x 464 = 82, 592 ft
82,592/43,560 =1.9
80,000 x 1.90 = 42,105
answer 42,105
39
Q 
The real property market is generally classified as a(n) \_\_\_\_\_\_\_\_\_\_ market.
perfect
imperfect
segregated
distressed
A

Imperfect

40
Q

An appraisal report is defined as “the ____________ communication of an appraisal; the document transmitted to the __________upon completion of an appraisal assignment.”

  • written, intended user
  • written or oral, client
  • oral, client
  • written, homeowner
A

written or oral, client

41
Q

“The rate at which vacant space in a property or a group of properties for sale or lease has been or is expected to be successfully sold or leased over a specified period of time” is the definition of a(n) __________ rate.

  • feasibility
  • absorption
  • lease-up
  • saturation
A

Absorption

42
Q

Under the current qualification criteria, an applicant for Appraiser Trainee must have completed ___ creditable hours of experience.

A

0 hours of experience

43
Q

What is the median of these numbers: 19, 11, 64, 36, 81, 22, 35, 95?

A

35.5

44
Q

The federal financial institutions regulatory agencies directly involved in fair lending include all of the following EXCEPT

  • ASB
  • FDIC
  • OCC
  • FRB
A

ASB

45
Q

The primary purpose of USPAP is to protect

  • appraisers
  • lenders
  • homebuyers
  • public trust
A

Public Trust

46
Q

Which is NOT a requirement of a valid deed?

  • must be in writing
  • property adequately described
  • consideration stated
  • must be recorded
A

Must be recorded

47
Q

3.15% is the same as

  • 3.150
  • .3150
  • .0315
  • .00315
A

.0315

48
Q

A lot measures 248.4 feet X 378.90 feet. How many acres is that?

A

2.16

49
Q

75 Here are all the sales in your area in the last 4 months. They sold for: $178,500; $166,000; $172,750; $182,000; $168,000; $174,000; $176,000; $184,000; $170,000; $175,000; $172,000; $181,500. What is the median sale price?

A

$174,500

50
Q

“The right held by the lessee to use and occupy real estate for a stated term and under the conditions specified in the lease“ is the definition of

  • leased fee estate
  • lessee estate
  • leasehold estate
  • lessor estate
A

Leasehold Estate

51
Q

Which is the fullest and most complete type of estate?

leased fee
life estate
leasehold
fee simple

A

Fee Simple

52
Q

A lot measures 316.4 X 428.90. How many acres is that?

A

3.12 acres

53
Q

Which of the following would be PRIVATE restrictions on property rights?

  • taxation and police power
  • easement and eminent domain
  • escheat and easement
  • deed restriction and mechanic’s lien
A

Deed restriction and mechanic’s lien

54
Q

The website with the largest amount of demographics information is

  • First gov.gov
  • Demographics.com
  • Bls.gov
  • Census.gov
A

Census.gov

55
Q

What is the median of the following set of gross rent multipliers? (95, 93, 120, 94, 93, 129)

A

94.5

56
Q

A client has requested that an appraiser value a property that is improved with an old dilapidated single family home, and asks the appraiser not to mention the existence of the home in the appraisal report. Which statement is TRUE regarding this situation?

  • The client has violated USPAP.
  • The appraiser must avoid mentioning this structure in the report.
  • It would be misleading if the appraiser did not disclose the existence of this structure in the report.
  • USPAP does not address this issue.
A

It would be misleading if the appraiser did not disclose the existence of this structure in the report.

57
Q

Which entity is responsible for monitoring state appraiser licensing and certification agencies?

  • The Appraisal Foundation
  • The Appraisal Standards Bureau
  • The Appraisal Subcommittee
  • Bureau of Consumer Financial Protection
A

The Appraisal Subcommittee

58
Q

Your property, which consists of a house on a lot, is valued at $186,000. You want to insure it for 80% of value. Insurance will cost $6.00 per thousand per year. How much will your insurance cost per month?

A

186,000 x .80 = 148,800
148,800 x .006 = 892.8
892.8/12 (months) =74.4
Answer: $74.40

59
Q

Short term money instruments are traded on the

  • money market
  • capital market
  • commodities market
  • New York Stock Exchange
A

Money Market

60
Q

A property is owned as tenancy in severalty. How many owners are there?

A

1 owner

Severality= severed (not several)

61
Q 
The intent of USPAP is to \_\_\_\_\_\_\_\_\_\_\_\_ a high level of \_\_\_\_\_\_\_\_\_\_ in professional appraisal practice.
promote, quality
promote and maintain, public trust
foster, professionalism
accommodate, professional ethics
A

promote and maintain, public trust

62
Q

An appraisal is best described as

  • an opinion of value
  • the estimated cost to -replace a property
  • a guarantee of the true worth of a property
  • an estimate of value
A

An opinion of value

63
Q

A circle contains _______ degrees.

A

360 degrees

64
Q

Who is responsible for appointing members to the ASB and AQB?

  • the Board of Trustees
  • the ASC
  • the President of The Appraisal Foundation
  • the Secretary of HUD
A

Board of Trustees

65
Q

The four components of the Appraiser Qualification Criteria are:

A

qualifying education, examination, experience, continuing education

66
Q

As part of the overall requirement for continuing education, certified and licensed appraisers must complete the 7-Hour National USPAP Update Course or its equivalent ________ calendar year(s).

A

every 2

67
Q

Twenty years ago, most appraisal reports that were sent electronically were sent using _____ technology; today, most appraisals are sent electronically using a _______ format.

PDI, PDF
EDI, PDF
PDF, EDI
EDI, JPG

A

EDI, PDF

68
Q 
Low interest rates encourage \_\_\_\_\_\_\_\_\_\_, while high interest rates encourage \_\_\_\_\_\_\_\_\_.
buying, selling
borrowing, saving
saving, borrowing
selling, buying
A

borrowing, saving

69
Q

When comparing printers, make sure to compare the cost per

  • letter
  • saved page
  • printed page
  • line
A

Printed Page

70
Q

A problem with the real property market is that the amount of ________ is slow to change.

  • demand
  • new customers
  • supply
  • supply and demand
A

Supply

71
Q

Which of the following would NOT be considered a negative easement?

  • access right of way
  • conservation easement
  • drainage easement
  • historic preservation easement
A

Access right of way

72
Q

Two years ago, you bought a property for $264,500. Values increased in that area by 5% the first year and 7% the second year. How much is your property worth today?

A 
264,500 x .05 = 13,225
264,500 + 13,225 = 277,725
277,725 x .07 = 19,400
277,725 + 19,400 = 297,165.75
Answer: 297,166
73
Q

When estimating the value of a fireplace in a single-family home, the most important principle is the principle of

change
substitution
increasing and decreasing returns
contribution

A

contribution

74
Q

Normally the first step in highest and best use analysis is to research the uses that are

socially acceptable
financially possible
legally permissible
maximally productive

A

legally permissible

75
Q

The four agents of production are land, ________, capital, and _____________.

materials, buildings
labor, entrepreneurial coordination
buildings, labor
materials, entrepreneurship

A

materials, entrepreneurship

76
Q

The Uniform Commercial Code covers the sale of goods over $________.

500
100
50
250

A

500

77
Q

The principle of supply and demand states that the price of a commodity, good, or service varies __________, but not necessarily _____________, with demand.

indirectly, proportionately
directly, proportionately
inversely, directly
directly, inversely

A

directly, proportionately

78
Q

“A business arrangement in which two or more persons jointly own a business and share in its profits and losses” is the definition of

limited partnership
partnership
general partnership
trust

A

partnership

79
Q

What is the purpose of a state’s statute of frauds?

gives the FBI jurisdiction over state authorities in certain cases
prohibits fraud in real estate transactions
establishes penalties for any criminal activities
requires certain documents to be in writing

A

prohibits fraud in real estate transactions

80
Q

The federal financial institutions regulatory agencies directly involved in fair lending include all of the following EXCEPT

Fannie Mae
FDIC
OCC
FRB

A

Fannie Mae

Basic Appraisal Principles (19 decks)

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