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Real Estate > Introduction to Modern Real Estate Practice > Flashcards

Introduction to Modern Real Estate Practice Flashcards

1
Q

Includes commercial property used for manufacturing, storage, distribution centers, research, warehousing, data centers

A

Industrial Real Estate

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2
Q

Explain Article 11 of the National Association of REALTORS® Code of Ethics.

A

Article 11 states that a REALTOR® may provide a service they are not specialized in only after fully disclosing their lack of experience, or if the REALTOR® obtains assistance from someone competent in the field, in which case, the client must be informed.

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3
Q

Who is on the Education Standards Advisory Committee?

A

12 members, including license holders, education members, and a public representative.

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4
Q

What is the ESAC?

A

Education Standards Advisory Committee

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5
Q

What is the function of ESAC?

A

To review and revise curriculum standards, course content and instructor certification requirements for both Core and MCE courses.

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6
Q

The actual piece of the earth, including anything below the surface of the land and the air above it.

A

Land

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7
Q

Made up of the land & any improvements attached to it

A

Real Estate

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8
Q

Real estate PLUS the bundle of rights that come with ownership of it

A

Real Property

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9
Q

Describes items that can easily be removed from the land

A

Personal Property

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10
Q

The right to use or cross someone else’s land for a specific purpose.

A

easement

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11
Q

The economic characteristic that informs the economic principle of supply and demand

A

Scarcity

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12
Q

An economic (not geographic) preference for a particular location

A

Situs

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13
Q

Refers to the fact that real estate exists in a fixed location and cannot be moved:

A

Fixity

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14
Q

The relative difficulty of converting an asset to cash without loss of value.

A

Illiquidity

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15
Q

Refers to the indestructible characteristic of land.

A

Durability

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16
Q

The price for which a property will sell if offered openly under normal conditions.

A

Market value

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17
Q

Supply and price move in…

A

opposite directions

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18
Q

What contains Fair Housing laws, community property laws, and homestead laws?

A

The U.S. Constitution and the State Constitutions

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18
Q

TREC has two main functions:

A
  1. To enforce all real estate-related statutes in The Texas Real Estate License Act (TRELA)
  2. To adopt and enforce new rules governing the practice of real estate
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19
Q

A Texas law that requires a commission, called the Sunset Commission, to evaluate every state agency every 12 years

A

Sunset Act

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20
Q

Who requires sponsorship to practice real estate?

A

A sales agent

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21
Q

The role of professional organizations in the real estate industry is…

A

to provide education and guidance to improve the practice of their members.

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22
Q

A REALTOR® must belong to…

A

at least one board in Texas.

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23
Q

An impartial, qualified appraiser’s opinion of the value of a specific property on a specific date, supported by relevant market information.

A

Appraisal

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24
Q

A very educated and data-driven approach to finding the market value of a property

A

An appraisal

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25
Q

A method of estimating the value of a property by determining how much it would cost to replace the building or other improvements, minus the cost of depreciation, plus the value of the land itself

A

Cost to replace

26
Q

a property appraisal method that estimates value by comparing the subject property to the sales prices of similar properties in the same market area

A

Sales comparison approach

27
Q

A method of estimating the value of a property by applying a rate of return to the net income it produces

A

Income approach

28
Q

The appraiser will compare estimates they made based on the cost approach, sales comparison approach, and/or income capitalization approach.

A

Reconciliation - since different methods will yield different results for the same property, the appraiser will reconcile these differences and come to a single number.

29
Q

A report that compares the prices of sold homes that are similar to the subject property

A

A comparative market analysis

30
Q

Good comps are properties…

A

within a quarter-mile of the subject property; with similar bedrooms, bathrooms, and square footage; sold within the last six months.

31
Q

A broker’s opinion of the value of a piece of real property, given in writing

A

Broker Price Opinion (BPO)

32
Q

A a market condition in which the number of properties for sale does not meet the demand (number of people looking to buy).

A

A seller’s market

33
Q

The pricing and negotiations of a transaction are often in favor of the seller in this type of market

A

A seller’s market

34
Q

the condition of having fewer buyers than the supply of homes for sale in the area

A

A buyer’s market

35
Q

The average number of months it will take to sell a house in a buyer’s market is…

A

six months or more.

36
Q

When an appraisal report is not available, what provides the BEST data for setting a listing price?

A

the price that willing buyers have recently paid for similar properties in the area

37
Q

A seller is more likely to want to work with an agent who uses the words “______ _______” rather than “price reduction.”

A

“price adjustment”

38
Q

The NAR® Code of Ethics is reviewed and updated ____________.

A

annually

39
Q

What is the difference between a client and a customer?

A

A client has an agency relationship with you or your broker, & a customer does not.

40
Q

To avoid _______, a license holder should only give factual information from reputable sources, avoid speculation, and point potential buyers to the resources that can help with questions that you shouldn’t answer.

A

misrepresentation

41
Q

Carelessness in the work that needs to be accomplished.

A

Negligence

42
Q

Usually occurs when a license holder attempts to facilitate a type of transaction that they have never attempted

A

Incompetence

43
Q

Avoid getting into trouble for misrepresentation by…

A

citing the source of any information you provide.

44
Q

Any issues with the property should be recorded on the _______ _______ _______, a form every seller is required to provide with a potential buyer with the contract.

A

Seller’s Disclosure Notice

45
Q

The illegal act of a license holder mixing their own money with a client’s or customer’s money.

A

Commingling

46
Q

The act of a broker or sales agent using a client’s or customer’s money for their own use

A

Conversion

47
Q

An exaggeration to accomplish a goal

A

Puffing

48
Q

A contract or form that TREC requires license holders to use

A

Promulgated contract/form

49
Q

In Texas, to belong to the local MLS, the REALTOR® must…

A

belong to at least one board in Texas

50
Q

What is the only scenario in which you do NOT need a real estate license to sell or lease a property?

A

If you are not receiving any commission from the sale

51
Q

True or False:
A real estate license is NOT required when a person is selling their portion of a joint ownership in a property.

A

True

52
Q

True or False:
Having a Recovery Fund payment made as a result of an improper transaction would not make the license of a salesperson inactive.

A

True

53
Q

Land is most valuable when it is in…

A

short supply & in high demand.

54
Q

Duplex, triplex, or fourplex residences are all considered ________ residences.

A

Multifamily

55
Q

Primarily made up of property that is used for business:

A

Commercial Real Estate

56
Q

Involves locating property, deciding how it can be best used, and then building on it:

A

Property Development

57
Q

The actual piece of earth, including anything below the surface of the land & the air above it:

A

Land

58
Q

Made up of the land & any improvements attached to it:

A

Real estate

59
Q

What are the 3 unique physical characteristics that make land special & different from personal property?

A

~ Indestructibility/durability
~ Immobility
~ Non-homogeneous

60
Q

Refers to the permanence of land:

A

Indestructibility

61
Q

Created solely by demand for land in particular areas:

A

Economic scarcity

62
Q

Land is most valuable when it is in _______ ________ & in _______ ________.

A

Short supply & high demand

63
Q
A

Real Estate (8 decks)

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