GUIDE QUESTIONS & ANSWERS
PASSED ALREADY GRADED A+
Management Plan - Correct Answer ✔✔ Assists the owner in meeting their goals while
maximizing the property's value and return. The plan describes in detail the subject
property's current use along with it's physical condition, fiscal projections, and
operational issues (includes an analysis of the market regional & neighborhood).
Organizational and educational programs available to assist in enhancing the property
manager's knowledge, identifying resources to resolve issues, and expanding their
business network. - Correct Answer ✔✔ Institute of Real Estate Management (IREM),
National Association of Realtors (NAR), Greater Capital Area Association of Realtors
(GCARR), building Owners & Managers Association (BOMA), National Association of
Real Estate Brokers, International Council of Shopping Centers (ICSC), and National
Property Management Association.
Market Analysis - Correct Answer ✔✔ Focuses on regional and neighborhood
evaluations. Includes demographic conditions, geographic features, governmental
prospective, existing real estate supply, future developments, and tenant/resident
demand
Market Analysis & Competitive Property Analysis helps to..... - Correct Answer ✔✔
Identify the subject property's strengths and weaknesses
The Highest & Best Use - Correct Answer ✔✔ When the property manager considers
alternatives to improve the property's weaknesses or further enhance its strengths to
improve overall economic performance.
Analysis of Alternative - Correct Answer ✔✔ Looks at the theoretical costs and
corresponding increase in rents by making different improvements, even property's
redevelopment.
When determining the best use of property, alternatives to consider are......... - Correct
Answer ✔✔ Rehabilitate without altering its existing use, Modernize by updating
finishes (more efficient equipment), Change the Use of building (including conversion),
or Conversion to a condominium m ownership structure.
Capital Expenditures - Correct Answer ✔✔ Projects that help extend the property's life.
Physical Obsolescene - Correct Answer ✔✔ is characterized as a condition of aging
(i.e. wear & tear) or deferred maintenance. Examples are worn carpet, peeling paint, a
leaking roof, or dead landscaping
, Functional Obsolescene - Correct Answer ✔✔ is characterized by old or outdated
designs or building systems.
Economic Obsolesence - Correct Answer ✔✔ Represents a loss in value due to outside
forces (i.e. location, market conditions). Examples would be an office building, locates in
a small town, where the major employer closes.
Investment Value - Correct Answer ✔✔ A value generally used by investors
Assessed Value - Correct Answer ✔✔ The value used by government tax assessment
offices
Market Value - Correct Answer ✔✔ The value that is agreed to between a buyer &
seller
Rules of Ethics for Property Manager - Correct Answer ✔✔ Loyalty to client,
confidentiality, accurate accounting & reporting, protection of owner's funds, conflicts of
interest, and compliance with law regulations.
An owner can be directly affected by manager's..... - Correct Answer ✔✔ Improper
handling of evictions, unlawful rent collections, failure to return security deposits, not
maintaining proper compliance with the Rental Accommodations Division (RAD)
The Management Agreement - Correct Answer ✔✔ is a formal and binding contract that
establishes the authority and responsibilities that a manager has on behalf of the owner.
Name of the owner & manager, term of agreement, describes the property, describes
services provided by manager, identifies who collects rental payments, identifies whose
name all service contracts are to be made, when funds are disbursed, whose
employees work at the property, bank accounts, fidelity bonds, identifies building
licenses, insurance requirements/ who secures policies, and management fees
compensation - Correct Answer ✔✔ Some provisions outlined in the Management
Agreement include:
Reasons for termination of Management Agreement - Correct Answer ✔✔ Sale or
transfer of the property, improper financial reporting, stealing funds, negligence, taking
kickbacks or benefiting directly from discounts from vendors, commingling funds.
Comparison Analysis - Correct Answer ✔✔ Helps determine if the subject property's
rental rates are appropriate for the market.
A Comparison Analysis should include: - Correct Answer ✔✔ Locational
advantages/Accessibility, Curb Appeal, Interior conditions, quality of finishes, Amenities,
Rents per square foot, Operating expenses per square foot