DC Property Management Exam Study Guide with Complete Solutions

DC Property Management Exam Study Guide with Complete Solutions Management Plan - Correct Answer 1. Current use 2. Current condition 3. Fiscal projections 4. Operational issues Market Analysis - Correct Answer Regional and neighborhood evaluation focusing on: 1. Demographic conditions 2. Geographic features 3. Governmental perspective 4. Existing real estate supply 5. Future developments 6. Tenant demand Analysis of Alternatives - Correct Answer Theoretical costs and potential for rent increase based on decision to: 1. Modernize 2. Rehabilitate 3. Change 4. Convert Capital Expenditures - Correct Answer Projects that help extend a properties useful life. Three Types of Obsolescence - Correct Answer 1. Physical Obsolescence is characterized as a condition of aging (i.e. wear and tear) or deferred maintenance. 2. Functional Obsolescence is characterized by old or outdated designs or building systems. 3. Economic Obsolescence represents a loss in value due to outside forces (i.e. location, market conditions). Five Types of Property Values - Correct Answer 1. Investment Value - This is the value that is generally used by investors. It is frequently determined either by calculating the Net Operating Income and applying a Capitalization Rate to it or from Cash Flow by determining the Return on Investment. 2. Assessed Value - This is the value used by government tax assessment offices. Since it is frequently determined using sophisticated mathematical models that are applied to many similar types of properties over a geographic area, it can be less accurate and produce results that are higher or lower than other types of "values". 3. Market Value - This is the value that is agreed to between a buyer and seller. It represents the "meeting of