Terms and Principles Flashcards
Real Estate
the physical land and everything attached to it; tangible; immovable; unique.
Real property
rights, benefits, and interests inherent in ownership of real estate; conveyed by deed.
4 powers of government
- escheat
- police power
- eminent domain
- taxation
Escheat
gives government title to a property if the owner dies without a will or heirs.
Police power
the right of government to regulate property to protect public health and safety, morals and the general welfare
taxation
allows state and local governments to raise revenue through assessments
eminent domain
the right of government to take private property for public use upon the payment of just compensation
fee simple
absolute ownership unencumbered by any other interest or estate
Leased fee
ownership interest held by landlord
leasehold
possessory interest held by tenant
Easement
the right to use another land for a stated purpose; conveys use, but not ownership.
realty
a term used to distinguish either real property or real estate from items of personal property
personal property (personalty)
moveable items of property that are not permanently affixed to real estate.
fixture
item of personal property permanently installed or affixed to real estate
trade fixture
personal property brought on a property by a tenant for use in conducting business
improvements pertaining to realty
personal property that cannot be removed without substantial physical damage or economic loss.
Historical cost
the actual cost to create something
replacement cost
the estimated to construct, at current prices as of a specific date, a substitute for a building
reproduction cost
the estimated cost to construct at current prices as of effective date of the appraisal, and exact duplicate or replica.
price
the sum of money or goods asked or given for something
value
the monetary worth of something to a buyer or seller at a given time
value in use
the value a specific property has for a specific use or to a specific person
value in exchange
the value a property has to a persons generally.
fair market value
highest price, date of valuation, seller, being willing to sell, ready, willing and able to buy, full knowledge of all the uses
Most probable selling price
the price at which a property would most probably sell if exposed on the market for a reasonable time under the market condition
Highest price
the highest price is the basis of establishing the fair market value of property taken under eminent domain law in california
Demand
reflects the needs of consumers
utility
the ability of a product to satisfy a human want, need, or desire
scarcity
the present or anticipated supply of an item relative to the demand for it
transferability
effective purchasing power
Factors that affect value (PEPS)
- physical
- economical
- political
- social
substitution
a buyer will not pay more for one property than for another that is equally desirable
supply and demand
value increases as supply decreases or demand increases
contribution
the value that an item contributes to the overall value of the property
anticipation
prospective future benefits
conformity
result of a reasonable degree of architectural sameness
progression
concept that a lower priced property will be worth more in a higher priced neighborhood than it would in a hood of comparable properties
regression
the concept that a higher priced property will be worth less in a lower priced hood than it would in hood of comparable properties.
competition
each property competes with all other properties suitable for the same use
balance
max value is reached at equilibrium
externality
value can be affected positively or negatively by factors external to a property
