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REL360 > Final Exam > Flashcards

Final Exam Flashcards

1
Q

Net Operating Income / Current Market Value =

A

Capitalization Rate

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2
Q

Value of real estate can be determined by analyzing

the sale prices of similar properties.

A

Sales Comparison Approach

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3
Q

The price a buyer should pay for a piece of property should equal the cost to build an equivalent building.

A

Cost Approach

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4
Q

Estimates the value of a property by taking the net operating income of the rent collected and dividing it by the capitalization rate.

A

Income Approach

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5
Q

(True or False) Homeowners might be interested in a home equity loan rather than a consumer loan because of the tax deductible principle payments.

A

False

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6
Q

(True or False) Homeowners might be interested in a home equity loan rather than a consumer loan because there is a longer term of repayment.

A

True

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7
Q

(True or False) Homeowners might be interested in a home equity loan rather than a consumer loan because interest rates are typically lower

A

True

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8
Q

(True or False) Homeowners might be interested in a home equity loan rather than a consumer loan because of easy availability

A

True

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9
Q

(True or False) A listing contract includes the duration of the listing.

A

True

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10
Q

(True or False) A listing contract includes the price of the listing.

A

True

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11
Q

(True or False) A listing contract includes the fee owed to the brokers.

A

True

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12
Q

(True or False) A listing contract includes a buyer agency agreement.

A

False

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13
Q

All real estate contracts must be ____ because of the Statute of Frauds.

A

written

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14
Q

(True or False) A listing contract will not terminate if the sellers move out of the state.

A

True

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15
Q

(True or False) A REIT must be publicly marketed

A

False

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16
Q

A real estate brokerage firm’s practice of market segmentation will help to identify the ______ in which the firm can concentrate and specialize.

A

Submarkets

17
Q

When the purchase contract is signed by the buyer and seller, the buyer immediately receives the:

A

equitable title

18
Q

A broker who receives an earnest money deposit from a buyer in connection with purchase contract should immediately do what with the money?

A

Turn over the money to a title company for deposit into their account.

19
Q

Rate of return on a real estate investment property based on the income that the property is expected to generate.

A

Capitalization Rate

20
Q

Where loans originate and borrowers/mortgage originators come together to negotiate terms.

A

Primary Mortgage Market

21
Q

Mortgage bankers, mortgage brokers, banks and thrifts are all part of the:

A

Primary Mortgage Market

22
Q

Wholesale market among lenders where existing home loans are resold.

A

Secondary Mortgage Market

23
Q

Conflict of interest inherent in any relationship where one party is expected to act in another’s best interests:

A

Agency Problem

24
Q

(True or False) REITs seek to purchase properties that have positive net present values (NPVs) and internal rates of return (IRRs) in excess of the REIT’s opportunity cost of capital

A

True

25
Q

Income capitalization and discounted cash flow techniques to make individual property acquisition and disposition decisions.

A

REIT Valuation

26
Q

Obligation of a party to perform depends on one or more conditions being met.

A

Contingency Clause

27
Q

Act designed to protect potential homeowners and enable them to become more intelligent consumers. Requires that lenders provide greater amounts of information to prospective borrowers at certain points in the loan settlement process.

A

RESPA

28
Q

Adjustment that is important to economic characteristics of income producing properties such as operating expenses, lease terms, tenant mix.

A

Property Adjustment

29
Q

Adjustment that is concerned with the nature and terms of the deal.

A

Transaction Adjustment

30
Q

(True or False) Real Estate can either be tangible or intangible.

A

True

31
Q

(True or False) Real Estate generates half of the world’s wealth and over 28% of the U.S GDP.

A

True

32
Q

(True or False) Property tax generates nearly 70% of all government revenue.

A

False.

Generates nearly 70% of local government revenue.

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