Key Terms

Question 1

Real estate professionals

Answer 1

Individuals and business organizations whose sole objective is performing a real estate-related service or function

Question 2

Property managers

Answer 2

These are Professionals who oversee specific properties on behalf of the owners. They ensure that the condition of the property and its financial performance meet the owners’ standards. They are also responsible for finding tenants for properties and collecting rent, responsible for rehabbing space for tenants or constructing new space. Finally, they have the responsibility of ordering repairs and maintaining their properties.

Question 3

Asset managers

Answer 3

Oversee groups of properties, or portfolios. Their is to achieve the investment objectives of their clients, as opposed to managing day-to-day operations

Question 4

Broker

Answer 4

A professional that a buyer or seller selects to perform real estate services. Those services may include locating properties or negotiating the sale of properties. They may also assist the client through the closing process

Question 5

Agent

Answer 5

A sponsored employee/independent contractor of the broker. The principal hires an agent to perform certain real estate duties

Question 6

Lenders

Answer 6

Professionals who make loans

Question 7

Title company

Answer 7

This company completes an “abstract of title”. That is a search of the records in the county where the property is held. They handle the disbursements of all monies

Question 8

Appraisers

Answer 8

Trained and licensed professionals authorized to perform appraisals of properties for other parties

Question 9

Mortgage Brokers

Answer 9

People who earn a fee to bring borrowers and lenders together. They do not service loans

Question 10

Professional Inspectors

Answer 10

People who inspect properties and offer an opinion of the property’s condition. This inspection includes structural, electrical, and mechanical systems

Question 11

Surveyors

Answer 11

People who are licensed to take formal measurements of the boundaries, dimensions, and elevations of a parcel of real estate

Question 12

Residential Property

Answer 12

Property that people own and use for housing. That includes apartments, duplexes, and single-family homes

Question 13

Commercial Property

Answer 13

Generally refers to retail and office properties. However, it may also include industrial real estate (ex: factories)

Question 14

Investment Property

Answer 14

Any property that owners hold for investment purposes

Question 15

Real Estate Commission

Answer 15

This is in charge of administering and enforcing license laws. In addition, the commission may pass regulations that further refine or clarify state statutes. In Texas, the commission is the Texas Real Estate Commission (TREC). TREC is responsible for administering The Real Estate License Act (TRELA)

Question 16

Property Value

Answer 16

The worth of a piece of real estate based on the price that a buyer and seller agree upon. The value of a property at any given time is determined by what the market will bear. Community factors affect property values. Those factors may include a new highway, power plant, strip mall, or new school in an excellent district

Question 17

Value

Answer 17

The present worth of future benefits that a person would gain from owning real estate

Question 18

Price

Answer 18

The amount of money or other asset that a buyer has agreed to pay and a seller has agreed to accept to complete the exchange of a good or service

Question 19

Market Equilibrium Principle

Answer 19

This principle states that the market demand moves to meet supply, and supply moves to meet demand

Question 20

Unit of Residential Demand

Answer 20

This is the household. A household is an individual or family who would occupy a dwelling unit. Residential demand can be further broken down into demand to lease versus buy and demand for single family homes versus apartments

Question 21

Unit of Commercial (retail and office) and Industrial Real Estate Demand

Answer 21

This is the square footage. It is further broken down into demand for leased space versus purchased space. In most instances, the area demanded refers to the improved area rather than the total lot area

Question 22

Supply

Answer 22

The property available for sale/lease that is measured according to property classification: dwelling units (residential), square feet (commercial/industrial), and acres (agricultural). It is influenced by costs (labor), availability of financing, investment returns, and government and community regulation and planning

Question 23

Demand

Answer 23

The property buyers and tenants which to acquire that is measured in households (residential), square feet (commercial/industrial), and acres (agricultural)