REE 4103 Exam 3
2 types of reports - ANS-oral or written
4 basic parts of a narrative report - ANS--Introduction
-Premises of the appraisal
-Presentation of data
-Analysis of Data and Conclusions
-Fifth section optional - Addenda
A _______________ would have the lowest ratio of operating expenses to gross
income incurred by the landlord. - ANS-triple net or absolute net
A demonstration narrative appraisal report: - ANS-may be based on hypothetical or
assumed data
a gross lease is one that: - ANS-landlord pays for all operating expenses
A lease clause that limits the expenses of the landlord is termed an: - ANS-expense cap
A lease that provides rental changes that are generally tied to consumer index? -
ANS-percentage lease
A lease which provides for rental changes annually tied to the consumer price index is
what kind of lease? - ANS-index lease
A lease which requires the landlord and tenant to arbitrate the amount of the lease upon
the tenant exercising a lease extension option is what type of lease? - ANS-revaluation
lease
A lease with the following annual payments: Year 1: $10,000 Year 2: $12,000 Year 3:
$14,000 Year 4: $16,000; would be called what type of lease? - ANS-step-up lease or
variable lease
A reconstructed operating statement for an owner operated property should include: -
ANS-management expense
, A rent multiplier: - ANS-is the ratio of the price of a real estate investment to its monthly
rental income before expenses
A rent survey reveals that apartment buildings offering one-bedroom units have a
considerably higher occupancy factor than those with two-bedroom units. If the subject
property includes only units with two bedrooms, the appraisal should probably project: -
ANS-lower occupancy or higher vacancy
A revaluation lease Provides for: - ANS-periodic rent adjustments based on the market
rental rate of the space
A technique of income capitalization in which the analyst need not distinguish interest
rates from capital recovery rates, but is most useful for comparable income properties: -
ANS-direct capitalization
A tenant who has an Exclusive Use Clause with a landlord, where the landlord later
allows a competing tenant in the same shopping center may: - ANS-exercise the clause
in a lawsuit
A transmittal letter does not include: - ANS-a full analysis of the cost income approach
All are main sections in the typical narrative appraisal report except: - ANS-a letter of
engagement
all are used in valuation of income-producing property except: - ANS-income taxes
All of the following lease provisions are advantageous to the lessee except: -
ANS-escalation clause
An "as of" date is specified in appraisals to: - ANS-Often the last date of inspection
An allowance for vacancy and collection loss is estimated as a percentage of: -
ANS-potential gross income
An established 20 year old motel would most likely be appraised based on: -
ANS-number of units
An oral appraisal report:
-Is not worth the paper it is written on
2 types of reports - ANS-oral or written
4 basic parts of a narrative report - ANS--Introduction
-Premises of the appraisal
-Presentation of data
-Analysis of Data and Conclusions
-Fifth section optional - Addenda
A _______________ would have the lowest ratio of operating expenses to gross
income incurred by the landlord. - ANS-triple net or absolute net
A demonstration narrative appraisal report: - ANS-may be based on hypothetical or
assumed data
a gross lease is one that: - ANS-landlord pays for all operating expenses
A lease clause that limits the expenses of the landlord is termed an: - ANS-expense cap
A lease that provides rental changes that are generally tied to consumer index? -
ANS-percentage lease
A lease which provides for rental changes annually tied to the consumer price index is
what kind of lease? - ANS-index lease
A lease which requires the landlord and tenant to arbitrate the amount of the lease upon
the tenant exercising a lease extension option is what type of lease? - ANS-revaluation
lease
A lease with the following annual payments: Year 1: $10,000 Year 2: $12,000 Year 3:
$14,000 Year 4: $16,000; would be called what type of lease? - ANS-step-up lease or
variable lease
A reconstructed operating statement for an owner operated property should include: -
ANS-management expense
, A rent multiplier: - ANS-is the ratio of the price of a real estate investment to its monthly
rental income before expenses
A rent survey reveals that apartment buildings offering one-bedroom units have a
considerably higher occupancy factor than those with two-bedroom units. If the subject
property includes only units with two bedrooms, the appraisal should probably project: -
ANS-lower occupancy or higher vacancy
A revaluation lease Provides for: - ANS-periodic rent adjustments based on the market
rental rate of the space
A technique of income capitalization in which the analyst need not distinguish interest
rates from capital recovery rates, but is most useful for comparable income properties: -
ANS-direct capitalization
A tenant who has an Exclusive Use Clause with a landlord, where the landlord later
allows a competing tenant in the same shopping center may: - ANS-exercise the clause
in a lawsuit
A transmittal letter does not include: - ANS-a full analysis of the cost income approach
All are main sections in the typical narrative appraisal report except: - ANS-a letter of
engagement
all are used in valuation of income-producing property except: - ANS-income taxes
All of the following lease provisions are advantageous to the lessee except: -
ANS-escalation clause
An "as of" date is specified in appraisals to: - ANS-Often the last date of inspection
An allowance for vacancy and collection loss is estimated as a percentage of: -
ANS-potential gross income
An established 20 year old motel would most likely be appraised based on: -
ANS-number of units
An oral appraisal report:
-Is not worth the paper it is written on
