IAAO 102 EXAMINATION TEST 2026
QUESTIONS WITH ANSWERS GRADED A+
◉ Substitution. Answer: the prices, rents, and rates of return of
property tend to be set by the current prices, rents and rates of
return for equally desire able substitute properties.
◉ Contribution. Answer: the value of a component of real estate can
be measured by the amount it contributes to net operating income
because net operating income can be capitalized into value.
◉ Market Value. Answer: means the most probable price which a
property should bring in a competitive and open market under all
conditions.
◉ 5 Analysis Questions for Investors -. Answer: 1. How much it cost?
2. How much will I get back?
3. When will I get it back?
4. What are the risk?
5. What are some comps ROI compared to my interested property?
, ◉ Leverage. Answer: borrowing of funds in hopes of earning a
greater return than the cost of the borrowed funds. This amount can
be be negative, positive, or neutral.
◉ Mortgage. Answer: most common type of financing for real estate.
◉ Junior Mortgage. Answer: typical a second mortgage
◉ Chattel Mortgage. Answer: a mortgage only on personal property.
◉ Amortized Mortgage. Answer: Fixed rate mortgage permanent
loan in which the sum of the principal and interest payments
remains fixed throughout the term of the loan.
◉ Four factors to capture overall yield rate (Yo) -. Answer: 1. Safe
rate
2. Risk Rate
3. Rate for non-liquidity
4. Rate for Management
◉ Recapture Rate. Answer: Provides for the return of the investment
in the wasting portion of the assets.
QUESTIONS WITH ANSWERS GRADED A+
◉ Substitution. Answer: the prices, rents, and rates of return of
property tend to be set by the current prices, rents and rates of
return for equally desire able substitute properties.
◉ Contribution. Answer: the value of a component of real estate can
be measured by the amount it contributes to net operating income
because net operating income can be capitalized into value.
◉ Market Value. Answer: means the most probable price which a
property should bring in a competitive and open market under all
conditions.
◉ 5 Analysis Questions for Investors -. Answer: 1. How much it cost?
2. How much will I get back?
3. When will I get it back?
4. What are the risk?
5. What are some comps ROI compared to my interested property?
, ◉ Leverage. Answer: borrowing of funds in hopes of earning a
greater return than the cost of the borrowed funds. This amount can
be be negative, positive, or neutral.
◉ Mortgage. Answer: most common type of financing for real estate.
◉ Junior Mortgage. Answer: typical a second mortgage
◉ Chattel Mortgage. Answer: a mortgage only on personal property.
◉ Amortized Mortgage. Answer: Fixed rate mortgage permanent
loan in which the sum of the principal and interest payments
remains fixed throughout the term of the loan.
◉ Four factors to capture overall yield rate (Yo) -. Answer: 1. Safe
rate
2. Risk Rate
3. Rate for non-liquidity
4. Rate for Management
◉ Recapture Rate. Answer: Provides for the return of the investment
in the wasting portion of the assets.
