Unit 12 Property Management Flashcards
Apartment rental rates are usually expressed A in monthly amounts. B on a per-room basis. C in square feet per month. D in square feet per year.
A in monthly amounts.
In preparing for variable expenses in a budget, the property manager should set up A a control account. B a floating allocation. C a cash reserve fund. D an asset account.
C a cash reserve fund.
An important concern in setting rents is I prevailing rates in the area. II current vacancy rates. A I only B II only C Both I and II D Neither I nor II
C Both I and II
Which of the following might suggest that rents are too low? A Poorly maintained building B Many “For Lease” signs in the area C High occupancy rate D High vacancy level
C High occupancy rate
Repairing a boiler is classified as which type of maintenance? A Preventative B Corrective C Routine D Construction
B Corrective
In renting units in an apartment building, a property manager must comply with all of the following EXCEPT A the terms of the management agreement. B the lawful instructions of the owner. C fair housing laws. D the AMA Code of Ethics.
D the AMA Code of Ethics.
Generally, the provisions of the management agreement should include all of the following EXCEPT
A a definition of the manager’s responsibilities.
B a listing of previous owners of the property.
C the extent of the manager’s authority as an agent.
D the calculation of management fees.
B a listing of previous owners of the property.
When selecting a tenant, consideration should be given to all of the following EXCEPT
A size of the space versus the tenant’s requirements.
B tenant’s ability to pay.
C racial and ethnic background of the tenant.
D compatibility of the tenant’s business with other tenants’ businesses.
C racial and ethnic background of the tenant.
A property manager is usually responsible for
I developing a budget and controlling expenses.
II communicating with the owner about physical problems with a building.
A I only
B II only
C Both I and II
D Neither I nor II
C Both I and II
When a property manager is establishing rental rates for the building, all of the following should be included as an operating expense EXCEPT A cleaning supplies. B management fees. C debt service payments. D routine repairs.
C debt service payments.
An active real estate license will be needed if the property manager is
A an employee of a partnership that owns the property to be managed.
B part owner of the property.
C an employee of a corporation that owns the property to be managed.
D a general partner of the partnership that owns the property to be managed.
A an employee of a partnership that owns the property to be managed.
A property manager who enters into a management agreement with an owner is usually a A special agent. B general agent. C universal agent. D designated agent.
B general agent.
Avoid, control, transfer, or retain are the four alternative techniques of A tenant relations. B acquiring insurance. C risk management. D property management.
C risk management.
Removing existing barriers when readily achievable in public buildings, such as adding Braille markings to elevator buttons, is a requirement of which law? A North Carolina License Law B Fair Housing Act C Equal Credit Opportunity Act D Americans with Disabilities Act
D Americans with Disabilities Act
A semiannual statement sent to an owner that does NOT reflect the entire debt service as an expense is called a(n) A a cash flow report. B a profit and loss statement. C a budget comparison statement. D an operating budget statement.
B a profit and loss statement.
Which of the following would be considered a variable expense when a manager develops an operating budget? A Employee wages B Property taxes C Building repairs D Basic operating costs
C Building repairs
A guest slips on an icy apartment building stair and is hospitalized. A claim against the building owner for medical expenses may be paid under which of the following policies held by the owner? A Workers’ compensation B Casualty C Liability D Fire and hazard
C Liability
Title III of the Americans with Disabilities Act (ADA) impacts which type of property? A Residential B Industrial C Privately owned D Commercial and public accommodations
D Commercial and public accommodations
The primary function of a property manager is to
A generate the highest possible cash flow for the owner.
B preserve the long-term resale value of the property.
C preserve the value of an investment property while generating income.
D create a tax loss for the owner while maintaining resale value.
C preserve the value of an investment property while generating income.
Property management has become a specialized area of real estate for all of the following reasons EXCEPT
A the increased size of buildings.
B the technical complexities of construction, maintenance, and repair.
C the trend toward absentee ownership by individual investors and investment groups.
D the increased number of tenants ages 21 to 29.
D the increased number of tenants ages 21 to 29.
Using borrowed funds is also termed A cash throwoff. B after-tax cash flow. C leveraging. D equity buildup.
C leveraging.
Cash flow is
A equivalent to operating expense.
B the total amount of spendable income left after expenses.
C the use of borrowed money to finance an investment.
D selling costs plus depreciation.
B the total amount of spendable income left after expenses.
If the leasing agent gets an 8% commission on rents collected, what would his annual commission be if he leases 20 offices at $750 a month? A $1,200 B $9,000 C $14,400 D $15,000
C $14,400
