Pratice Chapter 15 - Property Management

Question 1

Property Management

Answer 1

A branch of the real estate business involving the marketing, operation, maintenance and day-to-day financing of rental properties.

Question 2

Property Manager

Answer 2

A person who manages properties for an owner as the owner’s agent.

Question 3

Management Agreement

Answer 3

A contract between the owner of a property and someone who agrees to manage it.

Question 4

Management Proposal

Answer 4

A document that sets forth the duties of the manager when employed by the owner.

Question 5

Capital Expense

Answer 5

Expenditures creating future value. Incurred when a property owner spends money to upgrade a building in an effort to add value and/or extend the useful life of the building.

Question 6

Capital Reserve Budget

Answer 6

Money set aside by a property owner for long-term capital expenditures to a property.

Question 7

Corrective Maintenance

Answer 7

A maintenance task performed to identify, isolate, and rectify a problem with a property so that the property can be restored to an acceptable condition.

Question 8

Operating Budget

Answer 8

An amount of money set aside by the owner for a specific period for the property manager to manage the property effectively.

Question 9

Preventive Maintenance

Answer 9

Keeping property and equipment in a good state of repair so as to minimize the need for more costly repair work or replacement.

Question 10

Property Management Report

Answer 10

An accounting report issued periodically by the property manager to the owner outlining all income and expenditures for that accounting period.

Question 11

Variable Expense

Answer 11

Property expenditures that vary depending on the operations of the property.