Real Estate Property Management Exam Questions with 100% Correct Answers | 2024 Update

Real Estate Property Management Exam Questions with 100% Correct Answers | 2024 Update What is Property Management? - Answer ️️ --the oversight of real property by a team of managers or an individual for an owner. -What are the functions of a PM? - A property manager's primary objective is to produce the greatest net return for the owner. A property manager has the right to protect and work to increase the value of the owner's investment - One can use a PM for any income producing property - When is a RE license required for a property manager? - A license is required if they are working on behalf of one or more property owners. A license is not required for a salaried employee of one owner even if he or she collects rent. The Management Agreement - Answer ️️ -- creates a general agency relationship in which the owner = principle and the manager = agent. A property manager become a general agent and as such owes loyalty to the owner. - is a contract and should be in writing as well as signed * consists of: - A description of the property - Length of the agreement - The management authority - what the manager is responsible for and what the manager can make decisions on himself - Reporting - what type of reporting the owner expects and what kind of reports need to be sent to the owner - Management fees - usually between 3%-20% of the rent roll depending on the size and rents collected from the property. For condominium and Co-ops the fees are typically flat fees that are agreed to by the board and the agent. -Accounting responsibilities - which include the handling of security deposits, rents and expenses. The manager will typically collect all rents and hold them in a trust account for the owner. In handling the security deposits, the manager must comply with all government regulations. Security deposits are kept in separate accounts and cannot be commingled with operating funds. *Additionally, it includes: - Requirements for risk management - The owner's responsibilities and objectives and - How and why the management agreement can be terminated. Skills Required for a Property Manager - Answer ️️ -- Supervise others - Understand general accounting principles (GAP), monthly & yearly reports - Understand building systems i.e. HVAC, engineering, plumbing, etc. - Handle landlord-tenant relations (knowledge of local laws), negotiate leases, handle tenant issues - Lease space including space planning, area design, & building layout - Advertising & marketing - codes & regulations- local, state, & national - union negotiations - purchasing - appraisal, finance, money markets, depreciation techniques, financial trends, local market conditions - general construction knowledge - ecology - It is important for property managers to understand their properties rent rolls. A rent roll is a listing of all the rents in the building. Differences Between Markets - Answer ️️ -Office Building Management: Requirement for PMs- -Keep vacancies to a minimum - Analyze demographics to attract the prop