TX Principles of Real Estate PT 1 Flashcards
A type of property that includes one to four dwelling units.
Residential Property
Property that produces rental income or that is used in business. Properties with five or more dwelling units are considered commercial property.
Commercial Property
Property that is used by companies or persons for manufacturing, warehousing, or the assemblage of components.
Industrial Property
Property that is used by companies or persons for manufacturing, warehousing, or the assemblage of components.
Special Purpose Property
Any urban, suburban or village development, or even a single building, that blends a combination of residential, commercial, cultural, institutional, or industrial uses, where those functions are physically and functionally integrated, and that provides pedestrian connections.
Mixed-Use Property
Property inspectors must be licensed by the Texas Real Estate Commission…?
True
The qualifying Real Estate Principles course consists of how many classroom hours in total…?
30
How many points must an applicant earn in order to obtain their real estate broker’s license…?
3600
A physical characteristic of land describing that land as a unique commodity.
Non-homogeneity
The present worth of future benefits.
Value
The total dollar expenditure for labor, materials, and other items related to construction.
Cost
The amount of goods offered for sale within a given market at a given price during a given time period.
Supply
The amount of goods consumers are willing and able to buy at any given price during any given time period.
Demand
The study of the social and economic statistics of a community.
Demography
Which of the following factors can impact the value of real estate…?
Topography
Prevailing winds
Proximity to transportation
All of the above
All of the above
Which of the following affects supply…?
Employment
Cost of labor
Population
All of the above
Cost of Labor
The employer of an agent.
Principle
The party the agent brings to the principal as seller or buyer of the property.
Customer
An agent with limited authority to act on behalf of the principal, such as created by a listing.
Special Agent
Let the buyer beware. The buyer must examine the goods or property and buy at his or her own risk.
Caveat Emptor
Which of the following is a fiduciary duty owed by an agent to their client…?
Indemnification
Disclosure
Compensation
All of the above
Disclosure
This Act established the real estate licensing requirements in Texas in 1939…?
Texas Real Estate Dealers Act
Which of the following is exempt from having to obtain a real estate license to buy or sell real estate on someone else’s behalf…?
Someone acting under a power of attorney
Architects
Appraisers
All of the above
Someone acting under a power of attorney
A person authorized to act on behalf of another is known as a/an…?
Agent
Mark is looking to purchase a commercial office building. An appraiser was hired to assess the value of the building. What appraisal method did the appraiser use…?
Market Comparison Approach
Income Approach
Cost Approach
All of the above
Income Approach
Improvements typically ………… in value?
Depreciate
A means of comparing similar type properties, which have recently sold, to the subject property. Commonly used in comparing residential properties.
Market Comparison Approach
An analysis in which a value estimate of a property is derived by estimating the replacement cost of the improvements, deducting therefrom the estimated accrued depreciation, then adding the market value of the land.
Cost Approach
One of the three methods of the appraisal process generally applied to income producing property, and involves a three-step process – (1) find net annual income, (2) set an appropriate capitalization rate or “present worth” factor, and (3) capitalize the income dividing the net income by the capitalization rate.
Income Approach
Real estate licenses are issued for a period not to exceed how many years…?
2
The material of the earth, whatever may be the ingredients of which it is composed, whether soil, rock, or other substance, and includes free or unoccupied space for an indefinite distance upwards as well as downwards.
Land
Land and everything permanently attached to land.
Real Estate
The aggregate of rights, powers, and privileges conveyed with ownership of real estate.
Real Property
Personal property.
Chattel
The crops and other annual plantings considered to be personal property of the cultivator.
Emblements
Personal property that has become real property by having been permanently attached or adapted to real property.
Fixtures
Items that are installed by a commercial tenant and are removable upon termination of the tenancy.
Trade Fixtures
Trees and shrubbery that are not cultivated annually are considered…?
Real Property
Personal property that has become real property by having been permanently attached or adapted to real property is known as a/an…?
Fixture
All property that is not land and is not permanently attached to land is known as…?
Personal Property
Mineral rights are typically considered dominant to which of the following rights…?
Surface rights
Air rights
Sub-surface rights
None of the above
Surface rights
Which of the following is an example of a fixture…?
Kitchen cabinets
Removable bookshelves
Curtains
Rugs
Kitchen cabinets
Which of the following is considered a legal test for determining if an item is a fixture or not…?
All of the above
Intention of the parties
Adaptation of the item
Mode and permanence of how the item was attached
All of the above
A form of ownership in which stockholders in a corporation occupy property owned by the corporation under a lease.
Cooperative
A form of cluster zoning providing for both residential and commercial land uses within a zoned area.
Planned Unit Development (PUD)
Any urban, suburban or village development, or even a single building, that blends a combination of residential, commercial, cultural, institutional, or industrial uses, where those functions are physically and functionally integrated, and that provides pedestrian connections.
Mixed-use Property
The profit realized from the sale of real estate or other investment. Capital loss occurs when an investment property or another type of investment is sold at a loss.
Capital Gain
Which of the following is a tax deduction a homeowner can take advantage of…?
Mortgage interest payments
Real estate taxes
Loan origination fees
All of the above
All of the above
A married couple is exempt from paying taxes on capital gains for up to how much in profit if they lived in their house for at least 2 of the last 5 years…?
$500,000
What is the most common homeowners policy found in Texas…?
HOB
The replacement cost minus depreciation is referred to as…?
Actual cash value
PITI
principal, interest, taxes, and insurance.
A form of ownership of real property recognized in all states that consists of individual ownership of some aspects and co-ownership in other aspects of the property is known as a…?
Condominium
A mortgage payment typically includes…?
All of the above
Principal
Interest
Insurance
All of the above
The relationship between the principal and the principal’s agent which arises out of a contract, either expressed or implied, written or oral, wherein the agent is employed by the principal to do certain acts dealing with a third party.
Agency
A person authorized to act on behalf of another.
Agent
The party the agent brings to the principal as seller or buyer of the property.
Customer
An agent with full authority over one property of the principal, such as a property manager.
General Agent
An agent who is authorized to perform all acts or
duties his/her principal is empowered to perform
Universal Agent
C.O.A.L.D
Care, Obedience, Accounting, Loyalty, Disclosure
Reimbursement or compensation paid to someone for a loss already suffered.
Indemnification
The exaggeration of the good points of a product, or real property, and the prospects for future rise in value, profits, and growth.
Puffing
C.I.I.A
Compensation, Information, Idemnification, Availability
The Texas Deceptive Trade Practices Act defines this individual as someone who seeks, or acquires, by purchase or lease, any goods or services…?
Consumer
According to the Texas Deceptive Trade Practices Act, businesses with assets exceeding ………….. are not considered consumers?
25 million
A federal law that prohibits all discrimination on the basis of race.
Civil Rights Act of 1866
A law that prohibited discrimination on the basis of race, sex, color, national origin, or gender in any housing program receiving federal money.
Civil Rights Act of 1964
A federal prohibition on discrimination in sale, rental, financing, or appraisal of housing on the basis of race, color, religion, gender, national origin, handicap, or familial status.
Fair Housing Act of 1968
The Federal Fair Housing Act of 1968 was generally ineffective in combating housing discrimination…?
True
Based on the Texas Fair Housing Act of 1989, the Texas Workforce Commission has …………………….. days to investigate a fair housing complaint?
100
The Equal Credit Opportunity Act was enacted in…?
1974
The Community Reinvestment Act was passed in…?
1977
All buildings built after March 31, 1991 must comply with the design and construction requirements of the…?
Texas fair housing act
A respondent of a HUD fair housing complaint has how many days to submit a response…?
10
This federal law requires all federally regulated lenders to describe the geographic market area that they serve…?
Community Reinvestment Act
The interest of a client must be put before the interests of the agent. This is an example of…?
Fidelity
An agent must be honest and truthful. This is an example of…?
Integrity
An agent must be honest and truthful. This is an example of…?
Texas real estate commission
The Texas Real Estate Commission consists of how many members…?
9
How many members of the Texas Real Estate Commission are real estate brokers…?
6
How many members of the Texas Real Estate Commission are real estate brokers…?
3
Any complaints issued to TREC must be submitted within ………… years of the incident?
4
The Texas Real Estate Broker Lawyer Committee consists of how many members…?
13
Educational institutions that offer real estate licensing courses in Texas must hold a…?
Surety bond
What is an applicant required to submit as part of the licensing application process…?
Fingerprints
If an applicant holds a broker’s license in another state, how many years of active experience must the applicant have in the other state in order to satisfy the experience requirement in Texas…?
4
The education requirements for a broker’s application may be waived if the applicant held a broker’s license in the State of Texas within the preceding…?
2 years
TREC may renew a real estate license for no more than…?
2 years
Payments into the Real Estate Recovery Trust Account are provided by which of the following…?
License application fees
Certificate of Registration fees
Administrative penalty fees
All of the above
All of the above
As an alternative to paying an administrative penalty, the Commission may have a licensee pay which of the following…..?
Refund
A term used in describing the boundary lines of land, setting forth all the boundary lines together with their terminal points and angles.
Metes and Bounds
A monument used to establish the elevation of the point, usually relative to Mean Sea Level, but often to some local datum.
Bench Mark
A method of specifying the location of a parcel of land using prime meridians, base lines, standard parallels, guide meridians, townships and sections.
Government Survey System
Imaginary north-south lines which intersect base lines to form a starting point for the measurement of land.
Principal Meridians
Imaginary east-west lines which intersect meridian lines to form a starting point for the measurement of land.
Base Lines
A strip or column of land six miles wide, determined by a government survey, running in a north-south direction, lying east or west of a principal meridian.
Range
A series of government survey lines running north and south at six-mile intervals starting with the principal meridian and forming the east and west boundaries of townships.
Range Lines
In the survey of public lands of the United States, a territorial subdivision six miles long, six miles wide and containing 36 sections, each one mile square, located between two range lines and two township lines.
Township
Land in Texas was originally identified by…?
Metes and Bounds
Measure limits of a boundary
Metes and Bounds
Mile
Equal to 5,280 feet
Acre
Equal to 43,560 sq.ft.
Established by a government survey and contains 640 acres and is one mile square.
Section
The point of origin in a metes and bounds survey is also known as a…?
Point of Commencement
A contract in which each party promises to do something.
Bilateral Contract
When one party promises to do something if the other party performs a certain act, but the other party does not promise to perform it; the contract is formed only if the other party does perform the requested act.
Unilateral Contract
A contract in which something remains to be done by one or both of the parties.
Executory Contract
That which is capable of being adjudged void, but is not void unless action is taken to make it so.
Voidable
Anything given or promised by a party to induce another to enter into a contract, ex: personal services or even love and affection. It may be a benefit conferred upon one party or a detriment suffered by the other.
Consideration
The substitution or exchange of a new obligation or contract for an old one by the mutual agreement of the parties.
Novation
Damages benefiting the non-defaulting party as a result of a default of a contract.
Liquidated Damages
A law establishing the time period within which certain lawsuits may be brought
Statute of Limitations
An interest in real estate such that a court will take notice and protect the owner’s rights.
Equitable Title
The unlawful appropriation of another’s property, as in the conversion of trust funds.
Conversion
Occurs when property reverts
back to the State when an
individual dies without a will and
without heirs
Escheat
Real property ownership rights in the United States are based on this legal system…?
Allodial system
P.E.T.E
Police Power, Eminent Domain, Taxation, Escheat
An estate of indeterminable duration, e.g., fee simple or life estate.
Freehold Estate
Absolute ownership of real property; a person has this type of estate where the person is entitled to the entire property with unconditional power of disposition during the person’s life and descending to the person’s heirs or distributees.
Fee simple estate
An inheritable estate in land providing the greatest interest of any form of title.
Fee simple absolute
An estate that will end automatically when the stated event or condition occurs. The interest will revert to the grantor or the heirs of the grantor.
Fee simple determinable
Property or estate ownership that reverts back to the grantor after a temporary ownership period.
Estate in Reversion
The interest which a person has in lands or other property, upon the termination of the preceding estate. A future interest.
Reversionary Interest
In Texas, what is the limitation on homesteads in urban areas…?
10 acres
In Texas, what is the limitation on homesteads of a family in rural areas…?
200 acres
A claim, charge, or liability that attaches to, and is binding on real estate.
Encumbrance
A right of use in the adjoining land of another that moves with the title to the property benefiting from the easement.
Easement Appurtenance
Exists when a landowner has no access to roads and is landlocked.
Easement by Necessity
A right of use in the land of another without the requirement that the holder of the right own adjoining land.
Easement in Gross
Obtained by use of the land of another for the legally prescribed length of time.
Easement by Prescription
A grantor conveys the right to use the grantor’s land to a grantee for the purpose of ingress and egress.
Easement by voluntary grant
Land encumbered by an easement.
Servient Tenement
Land benefiting from an easement appurtenant.
Dominant Tenement
The process by which real or personal property of a party to a lawsuit is seized and retained for payment of an existing note secured by a mortgage or deed of trust against the property, becoming a co-guarantor for the payment of a mortgage or deed of trust note.
Attachment
Mortgage lenders typically require a…lien?
Preferred lien
The rights of a landowner or land occupier to use flowing water (such as a river) that is adjacent to the land.
Riparian Rights
The right of a property owner whose land borders on a body of water, such as a lake, ocean or sea, to reasonable use and enjoyment of the shore and water the property borders on.
Littoral Rights
An addition to property through the efforts of man or by natural forces.
Accession
The increasing in land area resulting from the deposit of soil by the natural action of the water.
Accretion
The gradual increase of earth on a shore of an ocean or bank of a stream resulting from the action of the water.
Alluvium
Increased soil, gravel, or sand on a stream bank resulting from flow or current of the water.
Alluvion
A sudden and perceptible loss of land by the action of water as by a sudden change in the course of a river.
Avulsion
Owned by one person only. Sole ownership.
Severalty Ownership
An ownership of realty by two or more persons, each of whom has an undivided interest, without the “right of survivorship”.
Tenancy in Common
Two or more natural persons own that comes with a special benefit called the right of survivorship.
Undivided ownership of a property interest by two or more persons each of whom has a right to an equal share in the interest and a right of survivorship, i.e., the right to share equally with other surviving joint tenants in the interest of a deceased joint tenant.
Joint Tenancy
Property acquired by husband and/or wife during a marriage when not acquired as the separate property of either spouse. Each spouse had equal rights of management, alienation, and testamentary disposition of community property.
Community Property
An entity established and treated by law as an individual or unit with rights and liabilities, or both, distinct and apart from those of the persons composing it. A corporation is a creature of law having certain powers and duties of a natural person. Being created by law it may continue for any length of time the law prescribes.
Corporation
A business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.
Limited Liability Company (LLC)
Which of the following listing contracts serves as a unilateral contract…?
Open listing
Exclusive Agency Agreement
Exclusive Right to Sell Agreement
All of the above
Open listing
