Unit 1: Overview Of Real Estate Flashcards
Fixture
if an item cannot be removed from the property without causing damage to the property.
Economics
field of study that analyzes how individuals, business, and governments make choices on allocating limited resources such as land, labour, and capital in order to satisfy apparently unlimited wants
Macroeconomics
economy-wide phenomena, such as inflation and unemployment affect society
Microeconomics
study individuals, households, and firms make decisions to allocate scarce or limited resources, where goods and services are being bought and sold
Econoic Growth
long-term expansion of the productive potential of any economy and it’s often meausred as the percentage change in the gross domestic product (GDP), adjusted for the inflation from one year over an earlier period.
GDP (Gross Domestic Product)
measures progress or the rate of expansion of the economys capacity to produce output
Causes Of Economic Growth
Natural Resources
Capital
Rate Of Savings
Technological Progress
Benefits Of Economic Growth
- improves standard of living
- stimulates employment
- increases government revenue
- increases capital investment
- enhances business confidence
Real Estate and It’s Effects On The Economy
- housing starts
- real estate sales
- vacancy rates and occupancy rates
- building permits issued
Housing Starts
number of privately owned new houses on which construction has been started in a given period
Real Estate Sales
number of real estate sales within a given period is another closely watched indicator affecting a market - driven economy
Vacancy Rates And Occupancy Rates
measure the number of available units not occupied against the total number of units available in a building or the amount of rentable space compared to the total space
Building Permits Issued
a written document issued by the municipal government granting permission for the construction of a new property or alteration, demolition, renovation, or recolation of an existing property
Factors Of Production
- land
- labour
- capital
- entrepreneurship
Supply
amount of a certain good or service the market can offer given a certain price
Supply Line Shift
occur when a change in quantity supplied is caused by only a change of price
Shifts
occur when there are changes in an influencing facotr other than the price
Factors In Shift Changes
a change in
- costs of production
- state of technology
- producers expectations
- number of suppliers in the market
- government taxes subsidies
Demand
the quantity of a good or service that would be bought at a certain price over a period of time.
Shifts In Demand
occur when there is a change in an influencing factor other than the price of the good or service
Factors Of Shifts In Demand
a change in
- consumer expectations
- number of consumers
- consumers disposable income or wealth
- cosumers tastes and preferences
- substitute or complement products
Market Equilibrium
used to refer to a state of balance between supply and demand forces
Market Surplus
a state of dis equilibrium where by the quantity supplied exceeds the quantity demanded at the current price
Market Shortage
a state of disequilibrium whereby the quantity demanded exceeds the quantity supplied at the current price
Market Indicators
measuring economic activity assesses supply and demand through numeric values
Business Indicators
supply of goods and services to the marketplace is a critical measure of economic output and performance
Gross Nation Product
measures the total output of an economy
Manufacturing
- covers 21 groups that produce goods for both industrial anf consumer use
- transformation of materials or substances into new products
Inventories
businesses maintain certain inventory levels to meet unexpected product demand
represent the dollar vaue of businesses raw materials, unfinished and finished ggods that are held in stock
rising and falling inventories indicate the output and employment
Consumer Indicators
- retail sales
- consumer confidence
- consumer price index
Consumer Confidence
a degree of optimism that consumers feel about the overall state of economy and their personal financial situation
Consumer Price Index (CPI)
indicator that measures the change in the consumer prices experienced by canadians
Types of Real Estate Markets
- balanced market
- buyers market
- sellers market
Balanced Market
occurs when the supply of available properties and the numebr of potential buyers are somewhat balanced
Buyers Market
when the inventory of the properties in the market exceeds the number of buyers competing for that inventory
Sellers Market
exist when the market demand for properties is higher that the available
Characterisitcs Of Real Estate Market
- booming local economy
- properties sell quickly
- increasing property prices
- increasing number of buyers
- smaller inventory of properties for sale
- limited time given to buyers to make purchase decision
- affordable mortgage financingrates
Characteristics Of Real Market
- local in nature
- slow to respond
- not standarized
- private transactions
Physical Characterisitcs of Real Estate
- real estate is unique
- real state fixed
- real estate is durable
- real estate is scarce
Demographics
study if the characteristics related to human populations
Market Bubble
characterized by a prolonged and self-sustaining acceleration in the real estate prices, combined with feverish construction, aggressive lending practices, and low interest rates.
Market Corrections
automatic processes through which the market readjusts from disequilibrium to equilibrium.
Self Regulation
regulatory model that enables government to delegate it’s authority to a representative body of individuals who will oversee and regulate the practice of their profession or industry.
Property Management
Leasing, negotiating or approving a lease or rental of real estate, or offering to do so.
Mortgage Brokers
Solicits a person to borrow or lend money that will be secured by a mortgage
Real Estate Appraiser
a person who can be defined as the exercise of developing and impartial estimate or opinion of the value of real property
Property Inspectors
provide and independent and objective analysis of a propertys major systems and components
Condominium Document Reviewers
are a type of legal property ownership that typically involves ownership of a residential unit and a protion of the propertys common area
Real Estate Lawyers
Work with clients to conclude real estate trades and mortgage deals
REIX
Real Estate Insurance Exchange
AREA
Alberta Real Estate Association
CREA
Canadian Real Estate Association
Real Estate Assurance Fund
compensates consumers who suffer financial loss as result of fraud, breach of trust, or a failure to disburse or account for money held by an industry professional with the respect to a trade in real estate or a deal in mortgages.
Canadian Condominium Institute
national, independent, non-profit organization that operates through chapters across canada
Association of Conduminium Managers of Alberta
a provincial, non-profit association providing resources and education providing resources and education to it’s members with in the condominium community (corporations, individuals, businesses)
ACM
Accredited Condominium Manager
RCM
Registered Condominiums Manager
Canadian Home Builders Association (CHBA)
member-based alliance of new home builders and related professionals with offices across Canada
BOMA
Building owners and Managers Association
Real Estate Institute of Canada (REIC)
national member-based association for professionals that provide real estate designation programs to advance opportunities for individuals in real estate.
Insitutue of Real Estate Management (REM)
member-based association for real estate managers across all property sectors
Society of Industrial and Office REALTORS (SIOR)
member-based association with Chapters located throughout the United-States, Canada, and Europe
