Real Estate: A Business of Many Specialties Flashcards
Residential Real Estate
Primarily focused on property used for living purposes. This includes single-family dwellings, duplexes, triplexes, fourplexes, and larger multi-family residences. Apartment leasing condos, co-ops, and townhouse.
Commercial Real Estate
Commercial real estate is primarily made up of property that is used for business.
Commercial real estate is usually income-producing properties like gas stations, office buildings, office parks, and convenience stores. Apartment buildings, although they are residential in the sense that people live there, are classified as commercial real estate. Single-family homes, duplexes, triplexes, and quads all may, in fact, produce income for the owner if they rent it out to others, but these buildings are still considered residential real estate.
Residential vs. Commercial
The distinction between residential and commercial real estate is important because different laws, contracts, and forms apply to each.
Industrial Real Estate
These are structures that can be rented and used to securely store property
Manufacturing, Storage, Distribution Centers, Research, Warehousing, Data Centers.
Property Development
involves locating property, deciding how it can be best used, and then building on it
Important: Property development is NOT what real estate agents do, although they can offer up their professional opinion to buyers of land, for instance, as to the possibilities for how the land might be used. But agents are NOT property developers themselves.
Developer Qualifications
A real estate license is NOT necessary to become a developer. The Texas Real Estate Commission doesn’t regulate new home builders.
Farm and Land - Rural Properties
include ranches, farms, and acreage tracts in subdivisions.
Leasing
bringing qualified tenants to lessors and property managers
Double Trouble
the law does not allow a sales agent to also be the loan officer or the appraiser in the same transaction for any FHA mortgage. Further, most companies will have policies forbidding the practice for any transaction.
There is a simple reason for that. An agent performing this kind of double duty would have too much control over the transaction, perhaps giving their client an unfair advantage.
Article 11
Obligation to provide only those services that they can deliver competently.
The services which the REALTORS® provide their clients and customers shall conform to the standards of practice and competence which are reasonably expected in the specific real estate disciplines in which they engage; specifically, residential real estate brokerage, real property management, commercial and industrial real estate brokerage, real estate appraisal, real estate counseling, real estate syndication, real estate auction, and international real estate.
REALTORS® shall not undertake to provide specialized professional services concerning a type of property or service that is outside their field of competence unless they engage the assistance of one who is competent on such types of property or service, or unless the facts are fully disclosed to the client. Any persons engaged to provide such assistance shall be so identified to the client, and their contribution to the assignment should be set forth (Amended 1-95).
If a REALTOR® was asked to provide a service that they did not specialize in, the REALTOR® may undertake the assignment only after fully disclosing their lack of experience, or if the REALTOR® obtains outside assistance from someone competent in the field. The REALTOR® must fully inform their client of any outside assistance and the degree to which that outside assistance contributed to the assignment.
To recap, you should be competent in the services you perform and should not attempt to provide services outside of your scope of expertise without getting assistance from a person who is competent in the area where you are lacking. In simple language, if you don’t know how to do something, find someone who does.
ESAC
Commission established an Education Standards Advisory Committee
To review and revise curriculum standards, course content, and instructor certification requirements for both Qualifying and Continuing Education courses (CE)
ESAC - Committee Membersd
The Education Standards Advisory Committee consists of 12 members appointed by the Commission as follows:
{Seven members who are license holders} and who have been engaged in the practice of real estate for at least five years before their appointment and who are actively engaged in that practice
{Four education members who are real estate instructors or owners of real estate schools}, accredited by the Commission, that provide qualifying or continuing education
One member who represents the public
