The Appraisal Profession Flashcards
1
Q
True or False: When completing an appraisal assignment, an appraiser may be an advocate for one party’s interest.
A
False
2
Q
An appraiser is defined as “one who is expected to perform valuation services _________, and in a manner that is independent, impartial, and objective.”
A
Competently
3
Q
True or False: All appraisals are performed for mortgage lending purposes.
A
False
4
Q
An applicant who wishes to become a Certified Residential appraiser must have accumulated a minimum of ______ hours of appraisal education.
A
200
5
Q
Which entity is responsible for establishing the requirements to become an appraiser?
A
the AQB
6
Q
True or False: Every state’s appraiser certification examination is different.
A
False
7
Q
The current requirements for real property appraiser licensing and certification went into effect on
A
May 1, 2018
8
Q
True or False: Some state agencies, such as departments of transportation, employ full-time staff appraisers.
A
True
9
Q
True or False: Attorneys often engage appraisers to complete assignments for estates and divorces.
A
True
10
Q
True or False: Of the required number of experience hours required for certified general appraiser applicants, at least 1,500 hours must be in the appraisal of non-residential property.
A
True
11
Q
How many experience hours are required as a prerequisite for Appraiser Trainee classification?
A
There is no experience prerequisite for Appraiser Trainee classification
12
Q
The number of required classroom education hours for Licensed Residential Appraisers under the 2018 AQB Criteria is ____ hours.
A
150
13
Q
The current AQB Real Property Appraiser Qualification Criteria went into effect
A
May 1, 2018
14
Q
Which of the following situations would NOT normally require an appraisal? [see pg.6]
A
Life insurance
15
Q
Which of the following situations would NOT normally require an appraisal? [see pg.6]
A
title insurance
16
Q
An appraisal report
A
can be either written or oral
17
Q
Under the 2018 AQB criteria, an Appraiser Trainee is permitted to have ________ supervising appraiser, but a supervising appraiser may not supervise ________ trainees.
A
More than one, more than three
18
Q
The continuing education requirement in the 2018 AQB Criteria (compared to the previous criteria):
A
remained unchanged
19
Q
As part of the overall requirement for continuing education, appraisers must complete the 7-Hour National USPAP Update Course or its equivalent ________ calendar year(s).
A
every 2
20
Q
The basic requirements for state licensed and state certified appraisers had their genesis in Title ___ of FIRREA.
A
XI
21
Q
The Licensed Residential Real Property Appraiser classification applies to the appraisal of non-complex one to four residential units having a transaction value __________ and complex one to four residential units having a transaction value ____________.
A
Less than $1,000,000, less than $400,000
22
Q
In 1987, eight U.S. appraisal organizations formed
A
The Appraisal Foundation
23
Q
True or False? The Board of Trustees acts as the executive board for The Appraisal Foundation.
A
True
24
Q
True or False? The Appraisal Foundation has significant legal authority to enforce USPAP.
A
False
25
In the 1970s, who developed uniform rules for mortgage underwriting?
Fannie Mae and Freddie Mac
26
Which entity is responsible for appointing members to the ASB and AQB?
the Board of Trustees
27
Which TAF advisory council consists of for-profit entities?
IAC
28
Who retains final authority over revisions to USPAP?
the Appraisal Standards Board
29
True or False? Appraisal management companies (AMCs) are required to comply with the requirements of USPAP.
False
30
If a fair housing violation has taken place, ___________ may file a complaint with Secretary of HUD, within one year after the alleged discriminatory housing practice has occurred or terminated.
An aggrieved person
31
The ______exercises all authority over the establishment of education, experience, and other criteria for licensing, certification, and re-certification of qualified appraisers.
AQB
32
The Appraisal Foundation is a ___________ organization.
not-for-profit
33
The _____ monitors state appraisal licensing and certification agencies.
ASC
34
________ has regulatory authority in enforcing the housing requirements in most civil rights legislation, including the Fair Housing Act.
HUD
35
The Appraisal Foundation was established in
1987
36
The largest professional appraisal society in the U.S. is the
Appraisal Institute
37
What entity is responsible for appointing members to the ASB and the AQB?
the Board of Trustees of The Appraisal Foundation
38
The _________ monitors and reviews the practices, procedures, activities and organizational structure of The Appraisal Foundation.
ASC
39
The Fair Housing Act of 1968, as amended, does NOT prohibit discrimination based on:
Age
40
Ethics concerns our obligation to consider
the well-being of society as a whole
the well-being of others
our own personal well-being
41
USPAP requires an appraiser to be
objective
42
True or False? An appraiser who selects only the data that supports the contract sale price in an appraisal has violated USPAP.
True
43
True or False? If not required to comply with USPAP by law, regulation, or agreement with the client, an appraiser may voluntarily choose to comply with USPAP.
True
44
True or False? It is unethical for an appraiser to pay a fee to be included on a lender's approved appraiser list.
False
45
An appraiser informs a client that the appraisal fee will be $100 higher than the standard fee because the appraiser's value opinion is for the property is over $500,000. Is it a violation of USPAP for the appraiser to quote the fee in this manner?
Yes
46
A client has requested that an appraiser value a property that is improved with an old dilapidated single family home and asks the appraiser not to mention the existence of the home in the appraisal report. Which statement is TRUE regarding this situation?
It would be misleading if the appraiser did not disclose the presence of this structure in the appraisal report.
47
An appraiser pays a fee for the procurement of an assignment. Where in the appraisal report does this payment have to be disclosed?
In the certification and any transmittal letter where conclusions are stated
48
If a fair housing violation has taken place, ___________ may file a complaint with Secretary of HUD, within one year after the alleged discriminatory housing practice has occurred or terminated.
An aggrieved person
49
The ______exercises all authority over the establishment of education, experience, and other criteria for licensing, certification, and re-certification of qualified appraisers.
AQB
50
The Appraisal Foundation is a ___________ organization.
not-for-profit
51
The _____ monitors state appraisal licensing and certification agencies.
ASC
52
________ has regulatory authority in enforcing the housing requirements in most civil rights legislation, including the Fair Housing Act.
HUD
53
The Appraisal Foundation was established in
1987
54
The largest professional appraisal society in the U.S. is the
Appraisal Institute
55
What entity is responsible for appointing members to the ASB and the AQB?
the Board of Trustees of The Appraisal Foundation
56
The _________ monitors and reviews the practices, procedures, activities and organizational structure of The Appraisal Foundation.
ASC
57
The Fair Housing Act of 1968, as amended, does NOT prohibit discrimination based on:
Age
58
Appraiser Bill pays a $150 fee to be included on a lender's "approved appraiser" list. When Bill prepares appraisal reports for this lender:
he must disclose that a fee was paid, but he does not have to disclose the amount
59
True or False? Webster’s Dictionary defines ethics as relating to the principles established by the world's most common religions.
False
60
When should an appraiser's compensation be dependent on reporting of a predetermined value conclusion?
Never
61
Is an appraiser permitted to base his or her appraisal fee on the owner's estimate of value of the subject property?
Yes, this is permissible.
62
An appraiser finds out after completing an appraisal that the lender/client's loan did not close. What should the appraiser do regarding the appraisal fee?
Charge the agreed-upon fee regardless of whether or not the loan closed
63
An appraiser offers a client a reduced fee on an appraisal if the client’s loan does not close. Which statement is TRUE regarding this situation.
This is unethical on the part of the appraiser.
64
In a GIS mapping system, _______ of data can be turned on and off for viewing or printing.
Layers
65
A common language called _______ was developed and standardized so that most software companies produced a common electronic report that could be read by most lending clients.
XML
66
In a UAD-compliant appraisal report, what would be the WORST overall condition rating for the subject property?
C6
67
EDI stands for
Electronic Data Interchange
68
The website with the largest amount of demographic information is
Census.gov
69
Which item of information for the subject property is an appraiser LEAST likely to find by searching on the internet?
current sales agreement
70
Modern definitions of the word "appraisal" have replaced the word _______ with ________.
estimate, opinion
71
"An identified parcel or tract of land, including improvements, if any" is the definition of
real estate
72
A client asks an appraiser to omit the client's identity from the appraisal report. What can the appraiser do?
Omit the client's identity from the report, but identify the client in the workfile.
73
"The party or parties who engage, by employment or contract, an appraiser in a specific assignment" is the definition of
client
74
Which is NOT considered to be real estate?
property rights
75
__________ rights are considered to be vertical rights.
Air
76
An article that was once personal property but has since been installed or attached to the land or building in a rather permanent manner is a(an)
fixture
77
Which of the following would MOST LIKELY be considered personal property?
window air conditioner
78
Which is NOT a characteristic of land?
mobility
79
“The interests, benefits, and rights, inherent in the ownership of real estate” is the definition of
real property
80
The Fifth Amendment to the U.S. Constitution states that the government can take private property, but must pay the property owner
just compensation
81
“A development right that cannot be used by the landowner, or that the owner chooses not to use, but can be sold to landowners in another location" are called ___________________ rights.
transferable development
82
“A pledge of a described property interest as collateral or security for the repayment of a loan under certain terms and conditions” is the definition of
mortgage
83
The process that the government uses when it exercises the power of eminent domain is called
condemnation
84
Which is NOT one of the primary systems of legal descriptions?
Rod and chain
85
True or False? A lot and block legal description always gives the lot size and dimensions.
False
86
Which system of legal description is the earliest of systems used in the U.S.?
Metes and bounds
87
A farmer purchased a half-section for $456,000. How much did the farmer pay for the property per acre?
$1,425
88
Which system of legal descriptions is based on standardized measurements and consistent rectangles and squares?
Rectangular survey
89
A farmer owns three full sections, four half-sections, and two quarter-sections. How many acres does this farmer own?
3,520
3 X 640 = 1,920. 4 X 320 = 1,280. 2 X 160 = 320. 1,920 + 1,280 + 320 = 3,520.
90
A farmer owns 4 full sections, 2 half sections and 7 quarter sections. How many acres does the farmer own?
4,320
4 X 640 = 2,560. 2 X 320 = 640. 7 X 160 = 1,120. 2,560 + 640 +1,120 = 4,320.
91
A lot contains 1.54 acres. It sells for $100,000. How much did it sell for per square foot?
$1.49
1.54 X 43,560 = 67,082.40. $100,000 ÷ 67,082.40 = $1.49.
92
A rectangular lot measures 8 chains and 36 links by 4 chains and 24 links. How many acres does this lot have?
3.55
8 X 66 = 528. 36 X .66 = 24. 528 + 24 = 552. That is one side of the rectangle. 4 X 66 = 264. 24 X .66 = 16. 264 +16 = 280. That is the other side of the rectangle. 552 X 280 = 154,560 square feet. 154,560 ÷ 43,560 = 3.55
93
How many degrees are in a full circle?
360
There are 360 degrees in a circle.
94
In the rectangular survey system, a township contains ______ square miles.
36
Each township is six miles on a side and contains 36 square miles.
95
The bearing and distance relative to north or south is called
Metes
Metes describe a bearing and distance, usually based on a direction from either north or south. Bounds are general boundaries, e.g., adjoining properties, roads, or waterways.
96
The general boundaries that a property line runs along are called
Bounds
97
Mary Jones has a property with no road frontage. She has an access right of way across the property of her neighbor Bob Smith for ingress, egress, and regress. Who has the dominant tenement in this situation?
Mary Jones
98
Which is the fullest and most complete type of estate?
Fee simple
99
When appraising a property that is subject to a life estate, an appraiser is MOST likely to use
a discount based on a mortality table
100
True or False? When a property is leased, two separate estates are created.
True
101
What is a corporation or trust that functions like a mutual fund for real estate, by combining the capital of many investors to acquire real estate?
REIT
102
Martha wants to purchase a property with her three sons. She wants a 70% ownership interest, and her sons will each have a 10% interest. What form of ownership will best suit her needs?
Tenancy in common
103
Tenancy by the entirety is a form of ownership reserved for
spouses
104
Which form of ownership does NOT have the right of survivorship?
tenancy in common
105
The most desirable form of timesharing is called ___________ timesharing.
fee
106
"Divided or undivided rights in real estate that represent less than the whole” is the definition of
partial interest
107
Which type or types of ownership include a right of survivorship?
Joint tenancy and tenancy by the entirety
108
A remainderman is found in which type of estate?
Life estate
109
A leasehold interest belongs to the
tenant
110
A fee simple estate is NOT
reserved for married couples only
111
A leasehold interest may have value when
the contract rent is less than market rent
112
“An easement that benefits a legal person or entity (individual, corporation, partnership, LLC, government entity, etc.) and not a particular tract of land” is the definition of a(an)
easement in gross
113
Which form of ownership allows each owner to possess the exclusive right to use and occupy an allotted three-dimensional space plus an undivided interest in common areas?
Condominium
114
"The holding of property by any form of title” is the definition of
tenancy
115
Which is the best type of deed for the buyer?
Warranty deed
116
In a real estate transaction, who is the grantee?
Buyer
117
Contracts are __________ that the law will enforce.
promises
118
The statute of limitations for suing for breach of an oral contract is __________ for written contracts.
shorter than
119
A ________ contract is binding and enforceable on all parties.
valid
120
As it refers to an individual's ability to contract, the word "competent" means
the ability to understand the transaction or document
121
A(n) ________ contract is one that has not been fully performed or completed.
executory
122
The general rule of contracting with minors is that a contract with a minor is
voidable at the minor's option
123
A lease that includes a specific level of rent that continues throughout the lease term is a(n)
flat rental lease
124
True or false? Punitive damages are commonly awarded in breach of contract cases.
False
125
What type of lease requires the landlord to pay all of the property's operating and fixed expenses?
Gross lease
126
Breach of contract is also known as
default
127
All of the following are required ingredients of a valid contract EXCEPT
legal description
128
A(n) __________ contract is one that has not been fully performed or completed.
executory
129
The Uniform Commercial Code covers the sale of goods over $__________.
500
130
Acceptance of a contract may occur as
either an express act or an implied act
131
A(n) __________ contract is one that results from the failure of the parties to meet some legal requirement.
voidable
132
The weakest form of deed is the ___________ deed.
quitclaim
133
The strongest form of deed is the _____________ deed.
warranty
134
"Feebleness on one side, overpowering strength on the other” is the definition of
duress
135
"Failing to perform any term of a contract, written or oral, without a legitimate legal excuse” is the definition of
breach of contract
136
Which would NOT be a required element of a valid deed?
Must be recorded
137
“A legally binding agreement between two or more persons that represents their promise to do or not to do a particular thing” is the definition of a(n)
contract
138
“A manifestation of willingness to be bound by the terms of an offer made in a manner invited or required by the offer” is the definition of
acceptance
139
"The cancellation of a contract by mutual agreement of the parties” is the definition of
rescission
140
“The mental ability to understand the general effect of a transaction or document" is the definition of
competency
141
"The correction or change of an existing document by court order upon petition of one of the parties to the document" is the definition of
reformation
142
According to the principle of supply and demand, the price of a commodity varies ___________ with supply.
inversely
143
Which type of market is MOST likely to be characterized by higher prices and a shortage of homes for sale?
Seller's market
144
True or False? A farmer's market is an example of a market at work.
True
145
Which would NOT be an example of a homogenous product?
A 1-acre vacant parcel of land
146
In real property, a market is defined in terms of
competition
147
Which of these would be considered the most INEFFICIENT market?
The real property market
148
“The area associated with a subject property that contains its direct competition" is the definition of
market area
149
A market in which product differentiation exists, there is a lack of important product or market information, and some of the producers and/or consumers are significant enough to affect the price and quantity of goods by their actions alone BEST describes a(n) ____________ market.
imperfect
150
The real property market is generally classified as a(n) ______________market.
imperfect
151
Real property is unique as an economic good in that it is
immovable
152
A neighborhood consists of ____________ land uses, while a district consists of __________ land uses.
complementary, homogeneous
153
The principle of supply and demand states, in part, that the price of real property varies directly with ________ and inversely with __________.
demand, supply
154
All of the following would be participants in the real property market EXCEPT
Economists
155
When supply and demand are out of balance, they tend to move towards
equilibrium
156
“A set of arrangements in which buyers and sellers are brought together through the price mechanism; the aggregate of possible buyers and sellers and the transactions between them.” is the definition of a
market
157
Which type of purchaser is more likely to pay more attention to the amenities of a property, such as a pool, a horse stable, or a nice view?
Owner-occupant buyer
158
Which statement is most TRUE about investors purchasing real property?
They are less concerned with amenities and more concerned with income and expenses.
159
True or False? Stocks are considered a good investment because the return OF your investment is guaranteed.
False
160
Which of the following typically generates the lowest return on investment?
Savings account
161
To whom is the Fed accountable?
Congress
162
Which of the following typically generates the highest return on investment?
Real estate
163
The return ON investment is usually accomplished through
interest payments
164
Amenities such as a nice view are generally more important to
homeowners
165
How do investors typically compensate for higher risk in an investment?
They demand a higher rate of return
166
Which of the following typically incurs the highest burden of management?
Real estate
167
“A tangible or intangible benefit of real property that enhances its attractiveness or increases the satisfaction of the user” is the definition of
amenity
168
What federal government entity is overseeing the conservatorship of Fannie Mae and Freddie Mac?
Federal Housing Finance Agency (FHFA)
169
What type of loans are assumable without the permission of the lender?
Very few loans of any type are assumable without lender permission
170
The principal operators in the secondary mortgage market include
Fannie Mae, Freddie Mac, Ginnie Mae
171
“The process of retiring a debt or recovering a capital investment, typically through scheduled, systematic repayment of the principal; a program of periodic contributions to a sinking fund or debt retirement fund" is the definition of
amortization
172
A property has a first mortgage of $180,000, a second mortgage of $25,000, and a third mortgage of $10,000. The borrower defaults, and the property is sold for $210,000. The holder of the third mortgage receives ______, and the holder of the second mortgage receives ________.
$5,000, $25,000
In this case the first mortgage holder gets paid their $180,000. That leaves $30,000. The second mortgage holder gets paid their $25,000 in full; which leaves only $5,000 for the third party in line.
173
3 of 4
"A pledge of a described property interest as collateral or security for the repayment of a loan under certain terms and conditions" is the definition of
mortgage
174
How is the FHA mortgage insurance program funded?
by mortgage insurance premiums paid by borrowers
175
A mortgage that has priority over all other mortgage liens on a property is a
first mortgage
176
An ARM is
an adjustable-rate mortgage
177
What is the name of the clause in a mortgage that requires the mortgage balance be paid off when the property is sold?
Due-on-sale clause
178
A purchaser bought a property for $215,000, put 15% down and borrowed the rest at 6.75% interest for 25 years. The lender charged 2.5 points at the closing. How much was paid for the points?
$4,568.75
A point is one percent of the amount of a mortgage loan. $215,000 X .15 = $32,250 down payment. $215,000 - $32, 250 = $182,750 mortgage amount. $182,750 X .025 = $4,568.75.
179
In 1968, FNMA was split into two organizations, which were
Fannie Mae and Ginnie Mae
180
Which were NOT sources of capital for banks in the 1950s?
Freddie Mac
181
A type of mortgage designed for retirees and other fixed-income home owners who owe little or nothing on their homes and want to tap their equity is called a _______________ mortgage.
reverse annuity
182
The government entity that oversees the conservatorship of Fannie Mae and Freddie Mac is
Federal Housing Finance Agency (FHFA)
183
Which was the first kind of mortgage to be developed?
Fixed-rate
184
The primary participants in the secondary mortgage market are
Fannie Mae, Freddie Mac, and Ginnie Mae
185
True or False? All major cities in the U.S. have zoning ordinances.
False
186
True or False? In addition to federal environmental authorities, each state has its own agency that controls environmental issues.
True
187
Taxes would be a(n) _____________ force affecting property values.
governmental
188
Value is influenced by
external market forces
189
An optimal U.S. unemployment rate would be
3% to 4%
190
True or False? Over the last several years in the U.S., there has been a substantial decrease in the number of people working from home.
False
191
True or False? In the United States, the average family size has been steadily decreasing over the last 50 years.
True
192
True or False? Population trends, ages, and family formations are all examples of social forces that affect values.
True
193
Generally speaking, low interest rates encourage ___________, while high interest rates encourage ___________.
borrowing, saving
194
Environmental influences on property values would include all of these EXCEPT
construction costs
195
If soil is wet or has a high water table, this may mean
the land may need to be drained or dredged
there could be wetland issues
there may be insect problems
196
Environmental influences on property values are sometimes called ________ influences.
physical
197
All of the following would be social influences EXCEPT
building codes
198
Economic forces would include all of the following EXCEPT
zoning and building codes
199
Which is NOT a reason for smaller household sizes?
More families with more than four children
200
Commercial rental operating expenses would typically include all of the following EXCEPT
vacancies
201
Which is NOT a benefit of community living?
increased privacy
202
When analyzing an income property, it is generally true that a property that is more valuable should
be able to generate more rent
203
Total construction costs are a combination of ________________ costs.
land, materials and labor
204
"A purchaser’s wish for an item to satisfy human needs (e.g. shelter, clothing, food, companionship) or individual wants beyond essential life-support needs” is the definition of
desire
205
Most insurance companies will give you a break on your fire insurance if you are within a certain distance from a
fire hydrant
206
Which federal agency is responsible for reviewing coastal development and water projects that may alter or destroy habitat?
NOAA
207
The most prominent federal agency in the environmental arena is
EPA
208
Which is not an environmental influence?
zoning and building codes
209
Which is a slow draining type of soil?
clay
210
14 of 14
Generally, low interest rates encourage _________, while high interest rates encourage __________.
borrowing, saving
211
Once stated, price is ________.
a fact
212
"The amount asked, offered, or paid for a property" is part of the definition of
price
213
"The monetary relationship between properties and those who buy, sell, or use those properties" is the best description of which appraisal term?
value
214
Exposure time is a _____________ developed by the appraiser.
retrospective opinion
215
The definition of which type of value begins, "the most probable price that a property should sell for..."
market value
216
The most common type of value sought by appraisers is
market value
217
What type of value requires an appraiser to consider the expectations of a particular investor or class of investors?
investment value
218
"The estimated length of time the property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal” is the definition of ___________ time.
exposure
219
USPAP says appraisers can use _________ in developing an opinion of reasonable exposure time.
interviews with market participants
information gathered through sales verification
statistical information about days on market
220
“The amount asked, offered, or paid for a property” is the definition of
price
221
"The market value of an established and operating business including the real property, personal property, financial assets, and the intangible assets of the business” is the definition of:
market value of the going concern
222
A value that cannot be imputed to any part of the physical property is called ___________ value.
intangible
223
The value of a property according to the tax rolls in ad valorem taxation is the definition of ___________ value.
assessed
224
USPAP says “When reasonable exposure time is a component for the definition of value being developed, the appraiser must also develop an opinion of ___________ time linked to the value opinion.”
reasonable exposure
225
"The amount a particular purchaser agrees to pay and a particular seller agrees to accept under the circumstances surrounding their transaction” is the best description of
price
226
"In economics, the attribution of value to goods or services based on how much can be obtained for them in exchange for other goods and services” is the definition of
value in exchange
227
A comparable property was offered on the market for 8 months at $429,000, with no offers. It was reduced to $419,000 and was on the market for another 6 months. It was reduced again to $359,000 and it sold for $355,000 in 3 months. What is the reasonable exposure time indicated by this property?
3 months
228
When purchasing a home as an owner-occupant, the purchaser's anticipated benefits are
amenities
229
A large three-car detached garage is constructed on a homesite at a cost of $65,000. The appraiser researches the market and finds that this garage only adds $30,000 in value to the property. Which valuation principle does this demonstrate?
contribution
230
True or False? Basic economic principles apply in the valuation of real property only.
False
231
A lot owner constructs a new 4,000 square foot home in a neighborhood of mostly 800 to 1,200 square foot homes. The value of the new 4,000 square foot home is diminished by the smaller homes surrounding it. This is an example of which valuation principle?
regression
232
When developing an opinion of highest and best use, what is the final criterion that is applied?
maximally productive
233
True or False? When developing an opinion of site value of an improved property, an appraiser needs to consider the highest and best use of the property as though vacant.
True
234
Supply and price move in a(n) ____________ relationship.
inverse
235
Which economic principle states that successive increments of one or more agents of production added to fixed amounts of the other agents will enhance income, in dollars, benefits, or amenities, at an increasing rate until a maximum return is reached?
increasing and decreasing returns
236
Good things or bad things can happen to the value of your property according to what is located around it. This illustrates the principle of
externalities
237
If there is anything at all left after satisfying the four agents of production, the excess profit would be returned to the land. This is the principle of
surplus productivity
238
Value is the present worth of future benefits. This is an illustration of the principle of
anticipation
239
"The result of the cause and effect relationship among the forces that influence real property value" is the definition of the principle of
change
240
"The principle that real property value is created and sustained when contrasting, opposing, or interacting elements are in a state of equilibrium” is the definition of the principle of
balance
241
When estimating the value of a swimming pool to a residential property, the most important principle is the principle of
contribution
242
What process would an appraiser use to identify submarkets within a larger market?
market segmentation
243
"The study of the supply and demand in a specific area for a specific type of property" is the definition of ____________ analysis.
market
244
A subject property's market area would be defined as
the area from where demand comes and that contains its competition
245
Researching and analyzing the number of new building permits issued is primarily an element of __________ analysis.
supply
246
In an urban market, an appraiser may note a trend of converting
apartments to condominiums
large single-unit homes to multi-unit apartments
apartments to co-ops
247
A large local employer announces plans for immediate expansion, which will add 400 new jobs. There are only 180 houses available for sale in the market at this time. What is MOST likely to happen in the near future?
The number of building permits issued will increase.
248
The study of the economics of individual spheres of activity or patterns and behaviors, e.g., a firm, an industry, a retail market, a consumer segment, pricing, local employment is the definition of
Microeconomics
249
“The study of the supply and demand in a specific area for a specific type of property” is the definition of
market analysis
250
In residential properties, which would NOT be a factor in demand analysis?
building permits issued
251
“The rate at which vacant space in a property or group of properties has been or is expected to be successfully sold or leased over a specified period of time” is the definition of a(n) __________ rate.
absorption
252
“A division of a total market that reflects the preferences of a particular set of buyers and sellers, e.g., fast food restaurants as a submarket of the overall restaurant market” is the definition of
submarket
253
Which of the following would NOT be considered in supply analysis for a residential property?
income and wage levels
254
"An analysis of the market conditions of supply, demand, and pricing or the demographics of demand for a specific property type in a specific area" is the definition of
market study
255
A local employer announces plans for immediate expansion, which will add 600 new jobs. There are only 120 houses available for sale in the market at this time. What is MOST likely to happen in the near future?
The number of building permits issued will increase.
256
You borrow $144,000 for 30 years and the interest rate is 6.2%. The lender requires you to pay 1.5 points at the closing. How much do you have to pay for the points?
$2,160
$144,000 X .015 = $2,160
257
6.7% is the same as
.067
258
If a neighborhood has 120 colonial homes and that represents 40% of the homes in the neighborhood, how many houses are there in the neighborhood?
300
120 ÷ .40 = 300
259
You bought a property 2 years ago for $400,000. You sold it today for $376,000. What was your average percent of loss per year?
3.00%
$400,000 - $376,000 = $24,000. $24,000 ÷ 400,000 = .06. .06 ÷ 2 = .03
260
Supply and price move in a(n) ____________ relationship.
inverse
261
Which economic principle states that successive increments of one or more agents of production added to fixed amounts of the other agents will enhance income, in dollars, benefits, or amenities, at an increasing rate until a maximum return is reached?
increasing and decreasing returns
262
Good things or bad things can happen to the value of your property according to what is located around it. This illustrates the principle of
externalities
263
If there is anything at all left after satisfying the four agents of production, the excess profit would be returned to the land. This is the principle of
surplus productivity
264
Value is the present worth of future benefits. This is an illustration of the principle of
anticipation
265
"The result of the cause and effect relationship among the forces that influence real property value" is the definition of the principle of
change
266
"The principle that real property value is created and sustained when contrasting, opposing, or interacting elements are in a state of equilibrium” is the definition of the principle of
balance
267
When estimating the value of a swimming pool to a residential property, the most important principle is the principle of
contribution
268
What process would an appraiser use to identify submarkets within a larger market?
269
What process would an appraiser use to identify submarkets within a larger market?
market segmentation
270
"The study of the supply and demand in a specific area for a specific type of property" is the definition of ____________ analysis.
market
271
A subject property's market area would be defined as
the area from where demand comes and that contains its competition
272
Researching and analyzing the number of new building permits issued is primarily an element of __________ analysis.
supply
273
In an urban market, an appraiser may note a trend of converting
apartments to condominiums
large single-unit homes to multi-unit apartments
apartments to co-ops
274
A large local employer announces plans for immediate expansion, which will add 400 new jobs. There are only 180 houses available for sale in the market at this time. What is MOST likely to happen in the near future?
The number of building permits issued will increase.
275
The study of the economics of individual spheres of activity or patterns and behaviors, e.g., a firm, an industry, a retail market, a consumer segment, pricing, local employment is the definition of
Microeconomics
276
“The study of the supply and demand in a specific area for a specific type of property” is the definition of
market analysis
277
In residential properties, which would NOT be a factor in demand analysis?
building permits issued
278
“The rate at which vacant space in a property or group of properties has been or is expected to be successfully sold or leased over a specified period of time” is the definition of a(n) __________ rate.
absorption
279
“A division of a total market that reflects the preferences of a particular set of buyers and sellers, e.g., fast food restaurants as a submarket of the overall restaurant market” is the definition of
submarket
280
Which of the following would NOT be considered in supply analysis for a residential property?
income and wage levels
281
"An analysis of the market conditions of supply, demand, and pricing or the demographics of demand for a specific property type in a specific area" is the definition of
market study
282
A local employer announces plans for immediate expansion, which will add 600 new jobs. There are only 120 houses available for sale in the market at this time. What is MOST likely to happen in the near future?
The number of building permits issued will increase.
283
You borrow $144,000 for 30 years and the interest rate is 6.2%. The lender requires you to pay 1.5 points at the closing. How much do you have to pay for the points?
$2,160
$144,000 X .015 = $2,160
284
6.7% is the same as
.067
285
If a neighborhood has 120 colonial homes and that represents 40% of the homes in the neighborhood, how many houses are there in the neighborhood?
300
120 ÷ .40 = 300
286
You bought a property 2 years ago for $400,000. You sold it today for $376,000. What was your average percent of loss per year?
3.00%
$400,000 - $376,000 = $24,000. $24,000 ÷ 400,000 = .06. .06 ÷ 2 = .03
287
In the following set of numbers (18, 26, 29, 18, 44) what is the mean?
27
18 + 26 + 29 + 18 + 44 = 135. There are 5 numbers. 135 ÷ 5 = 27
288
In the following set of numbers (18, 26, 29, 18, 44) what is the mode?
18
289
What is the mode of the following set of numbers (57, 90, 70, 68, 61, 62)?
There is no mode
290
The median price of homes sold in your county six months ago was $209,000. Prices have been increasing at the rate of 8% per year. What is the median price of homes today?
$217,360
$209,000 X 1.04 = $217,360
291
In the following set of numbers (18, 26, 29, 18, 44) what is the mean?
27
18 + 26 + 29 + 18 + 44 = 135. There are 5 numbers. 135 ÷ 5 = 27
292
35% of the houses in a neighborhood are split levels and 24% are ranches. There are a total of 325 houses. How many are ranches?
78
325 X .24 = 78
293
If a neighborhood has 120 colonial homes and that represents 40% of the homes in the neighborhood, how many houses are there in the neighborhood?
300
120 ÷ .40 = 300
294
Study Chapter 18
Real Estate Math
295
Short term money instruments are traded on the
money market
296
When appraising an income producing property, you have the following GRMs indicated from comparable sales (122, 159, 132, 126, 122, 173, 152, 126). What is the mode of the GRMs?
Bi-modal
297
A rectangular property measures 320 feet by 574.45 feet, and it sold for $263,750. How much did it sell for per acre?
$62,500
320 X 574.45 = 183,824 square feet. 183,824 ÷ 43,560 = 4.22 acres. $263,750 ÷ 4.22 = $62,500
298
The primary operators in the secondary mortgage market include all of the following EXCEPT
FHA
299
"A mortgage in which the interest rate may move up or down, following a specified schedule or in accordance with the movements of a standard or index to which it is tied” is the definition of a(n) ______________ mortgage.
adjustable rate
300
“An analysis of the market conditions of supply, demand, and pricing for a specific property type in a specific area” is the definition of
market study
301
Which is the fullest and most complete type of estate?
fee simple
302
Which of the following would be private restrictions on property rights?
deed restriction and mechanic’s lien
303
8.8% is the same as
.088
304
Which entity is responsible for monitoring state appraiser licensing and certification agencies?
The Appraisal Subcommittee
305
You have found comparable sales of rural land parcels that indicate the following sale prices per acre: ($930, $775, $1202, $995, $1612, $906). What is the median of these indications?
$962.50
306
A lot measures 316.4 X 428.90. How many acres does it have?
3.12
316.4 X 428.90 = 135,704 Square feet. 135,704 ÷ 43,560 = 3.12 acres
307
The ETHICS RULE of USPAP is the ________ of five Rules in USPAP.
first
308
Which is NOT a characteristic of tenancy in common?
There is a right of survivorship
309
You want to buy a house for $216,500. You can get a loan for 90% of value. You will also have to pay 1.5 points on the loan. If you have to pay both the down payment and the loan points at closing, how much will you have to deliver to closing to cover these?
$24,572.75
$216,500 X .90 = $194,850. $194,850 X .015 = $2,922.75 paid in points. Add in the down payment: $216,500 X .10 = 21,650. $21,650 + $2,922.75 = $24,572.75
310
"For real property, a personal, unassignable, and typically revocable privilege or permit to perform some activity on the land of another without obtaining an interest in the property” is the definition of
license
311
What type of property ownership is characterized by the purchase of shares of stock in a corporation, which provides a proprietary lease to occupy an apartment unit?
Cooperative
312
All of the following could be participants in a real property market EXCEPT
assessors
313
The Equal Credit Opportunity Act (ECOA) is enforced by:
Consumer Financial Protection Bureau
314
Which entity retains final authority over revisions to USPAP?
the Appraisal Standards Board
315
The appraisal standards and qualification criteria that are published by The Appraisal Foundation achieve legal authority by adoption, citation or implementation by
government agencies with the power to regulate or administrate
316
A client asks an appraiser to omit the client's identity from the appraisal report. What can the appraiser do?
Omit the client's identity from the report but identify the client in the workfile
317
The oldest system of legal descriptions for real estate is:
metes and bounds
318
The Appraisal Foundation is a
not-for-profit organization
319
The number of required experience hours for Certified General Appraiser applicants is ____ hours.
3,000
320
Which of the following would NOT be considered a negative easement?
access right of way
321
Which of the following is NOT a characteristic of land?
mobility
