Principles of Real Estate (Ch. 1 - 4)
Exam Questions and Answers
Tenancy at Sufferance - Answer-Occurs when a tenant stays beyond legal tenancy
without the consent of the landlord
The tenant is commonly called a holdover tenant. If, during the holdover period, the
tenant pays and the landlord accepts rent it changes to a periodic estate
Residential Brokerage - Answer-Requires a broad knowledge of the community and
its neighborhoods, finance, real estate law, economics, and the money market
Commercial Brokerage - Answer-Specializes in income-producing properties such as
apartment and office buildings, retail stores, and warehouses. In this speciality, the
sales agent is primarily selling monetary benefits. These benefits are the income,,
appreciation, mortgage reduction, and tax shelter that a property can reasonably be
expected to produce
Industrial Brokerage - Answer-Specializes in finding suitable land and buildings for
industrial concerns. This includes leasing and developing industrial property as well
as listing and selling it. Must be familiar with industry requirements such as proximity
to raw materials, water and power, labor supplies, and transportation. Must also
know about local building, zoning, environmental, and tax laws as they pertain to
possible sites, and about the schools, housing, and cultural and recreational facilities
that would be used by future employees of the plant
Farm Brokerage - Answer-Must be equally capable of handling the 160-acre spread
of a farmer and the 10,000-acre operation owned by an agribusiness corporation.
College training in agriculture is an advantage and on-the-job training is a must.
Knowledge of soil types, seeds, fertilizers, production methods, new machinery,
government subsidies, and tax laws is vital to success
Property Management - Answer-Job is to supervise every aspect of a property's
operation so as to produce the highest possible financial return over the longest
period of time. Tasks include renting, tenant relations, building repair and
maintenance, accounting, advertising, and supervision of personnel and
tradespeople
Apartment Locators - Answer-Helping tenant s find rental units and helping landlords
find tenants. Are paid commissions by management companies and owners of
apartment projects for finding qualified tenants. Must have an in-depth knowledge of
the apartment complexes in the community nd their requirements for tenants.
Roommate Locators - Answer-Central places where people who are looking for other
people willing to share living space can meet. Maintains files on people with space to
share and those looking for space. The files will contain information on location, rent,
male or female, smoking or nonsmoking, etc.
,Real Estate Appraising - Answer-Gather and evaluate all available facts affecting a
property's value. Requires practical experience,technical education, and good
judgment
Government Service - Answer-Government employees who can negotiate purchases
and sales, appraise, finance, manage, plan and develop. Includes vacant and
forested lands, office buildings, museums, parks, zoos, schools, hospitals, public
housing, libraries, fire and police stations, roads and highways, subways, airports,
and courthouses. At the federal level, the Forest Service, Park Service, Department
of Agriculture, Army Corps of Engineers, Bureau of Land Management, and General
Services Administration are all major landholders. Government agencies such as the
Federal Housing Administration, Department of Veterans Affairs, and Federal Home
Loan Bank employ thousands of real estate specialists to keep their real estate
lending programs operating
Land Development - Answer-Build new houses and in turn, sell them to homeowners
and investors
Urban Planning - Answer-Work with local governments and civic groups for the
purpose of anticipating future growth and land use changes. Makes
recommendations for new streets, highways, sewer and water lines, schools, parks,
and libraries. The current emphasis on environmental protection and controlled
growth has made this one of real estate's most rapidly expanding specialties
Mortgage Financing - Answer-Have a dual role: 1). To find economically sound
properties for lenders and 2) to locate money for borrowers. Can work
independently, receiving a fee from the borrower for locating a lender, or as a
salaried employee of a lending institution
Securities and Syndications - Answer-Limited partnerships and other forms of real
estate syndications that combine the investment capital of number of investors to
buy large properties number in the thousands
Consulting - Answer-Involves giving others advice about real estate for a fee. Must
have a very broad knowledge of real estate - including financing, appraising,
brokerage, management, development, construction, investing, leasing, zoning,
taxes, title, economics, and law. Most have a real estate license
Title Insurance - Answer-A person who is very good at performing simple accounting
procedures and preparing closing statements and has an outgoing personality could
be an excellent escrow offer. One who is one inclined to the technical side, research,
or document review could be a title examiner
Full-Time Investor - Answer-Purchase,inexpensive lay and with a low down payment,
a small apartment building that has not been well maintained but is in a god
neighborhood. The property is then thoroughly reconditioned and rents are raised.
Research and Education - Answer-Can concentrate on such matters as improved
construction materials and management methods, or on finding answers to
, economics questions such as "What is the demand for homes going to be next year
in this community (state, country)?"
Education Standard Advisory Committee (ESAC) - Answer-To regularly review and
revise curriculum standards, course content requirements, and instructor certification
requirements for core and Continuing Education (CE) courses. Committee consists
of:
*Seven members who have been engaged in the practice of real estate for at least
five years before appointment and who are actively engaged in that practice
* Four members who are real estate instructors or owners of real estate schools
accredited by TREC that provide core or continuing education
* One member who represents the public
The long-term goals for this group include reviewing the following:
* All core curriculum content
* Course fees and approval processes
* The acceptability of the various course delivery methodologies (such as classroom,
correspondence, alternative delivery, and combination delivery courses)
* Alternative evaluation methods of student mastery (other than examinations)
* Provider qualifications
* Instructor qualification standards, including both delivery and mastery
Real estate (or real property) - Answer-Land and the improvements made to land as
well as the rights to use them
Realty - Answer-Refers to land and buildings and other improvements from a
physical standpoint
Real Property - Answer-Refers to land and improvements both on and to the land,
and also to the physical aspects of real estate, including surface, air and subsurface
rights plus, bundle of rights.
Land - Answer-Starts. At the center of the earth, passes through the earth's surface,
and continues on into space
Improvements - Answer-Any form of land development, such as buildings, roads,
fences and pipelines
Personal Property (or personality) - Answer-A right or interest in things of a
temporary nature; Items that are not a part of the land, such as tables, chairs, beds,
desks, automobiles, farm machinery, and the like
Fixtures - Answer-An object that has been attached to land so as to become real
estate: is the property of the landowner, and when the land is conveyed to a new
owner, it is automatically included with the land
Tests of a Fixture - Answer-1. Method of annexation of the real estate
2. Fitness or adaptation to a particular use of the premises
3. The intention of the parties
Exam Questions and Answers
Tenancy at Sufferance - Answer-Occurs when a tenant stays beyond legal tenancy
without the consent of the landlord
The tenant is commonly called a holdover tenant. If, during the holdover period, the
tenant pays and the landlord accepts rent it changes to a periodic estate
Residential Brokerage - Answer-Requires a broad knowledge of the community and
its neighborhoods, finance, real estate law, economics, and the money market
Commercial Brokerage - Answer-Specializes in income-producing properties such as
apartment and office buildings, retail stores, and warehouses. In this speciality, the
sales agent is primarily selling monetary benefits. These benefits are the income,,
appreciation, mortgage reduction, and tax shelter that a property can reasonably be
expected to produce
Industrial Brokerage - Answer-Specializes in finding suitable land and buildings for
industrial concerns. This includes leasing and developing industrial property as well
as listing and selling it. Must be familiar with industry requirements such as proximity
to raw materials, water and power, labor supplies, and transportation. Must also
know about local building, zoning, environmental, and tax laws as they pertain to
possible sites, and about the schools, housing, and cultural and recreational facilities
that would be used by future employees of the plant
Farm Brokerage - Answer-Must be equally capable of handling the 160-acre spread
of a farmer and the 10,000-acre operation owned by an agribusiness corporation.
College training in agriculture is an advantage and on-the-job training is a must.
Knowledge of soil types, seeds, fertilizers, production methods, new machinery,
government subsidies, and tax laws is vital to success
Property Management - Answer-Job is to supervise every aspect of a property's
operation so as to produce the highest possible financial return over the longest
period of time. Tasks include renting, tenant relations, building repair and
maintenance, accounting, advertising, and supervision of personnel and
tradespeople
Apartment Locators - Answer-Helping tenant s find rental units and helping landlords
find tenants. Are paid commissions by management companies and owners of
apartment projects for finding qualified tenants. Must have an in-depth knowledge of
the apartment complexes in the community nd their requirements for tenants.
Roommate Locators - Answer-Central places where people who are looking for other
people willing to share living space can meet. Maintains files on people with space to
share and those looking for space. The files will contain information on location, rent,
male or female, smoking or nonsmoking, etc.
,Real Estate Appraising - Answer-Gather and evaluate all available facts affecting a
property's value. Requires practical experience,technical education, and good
judgment
Government Service - Answer-Government employees who can negotiate purchases
and sales, appraise, finance, manage, plan and develop. Includes vacant and
forested lands, office buildings, museums, parks, zoos, schools, hospitals, public
housing, libraries, fire and police stations, roads and highways, subways, airports,
and courthouses. At the federal level, the Forest Service, Park Service, Department
of Agriculture, Army Corps of Engineers, Bureau of Land Management, and General
Services Administration are all major landholders. Government agencies such as the
Federal Housing Administration, Department of Veterans Affairs, and Federal Home
Loan Bank employ thousands of real estate specialists to keep their real estate
lending programs operating
Land Development - Answer-Build new houses and in turn, sell them to homeowners
and investors
Urban Planning - Answer-Work with local governments and civic groups for the
purpose of anticipating future growth and land use changes. Makes
recommendations for new streets, highways, sewer and water lines, schools, parks,
and libraries. The current emphasis on environmental protection and controlled
growth has made this one of real estate's most rapidly expanding specialties
Mortgage Financing - Answer-Have a dual role: 1). To find economically sound
properties for lenders and 2) to locate money for borrowers. Can work
independently, receiving a fee from the borrower for locating a lender, or as a
salaried employee of a lending institution
Securities and Syndications - Answer-Limited partnerships and other forms of real
estate syndications that combine the investment capital of number of investors to
buy large properties number in the thousands
Consulting - Answer-Involves giving others advice about real estate for a fee. Must
have a very broad knowledge of real estate - including financing, appraising,
brokerage, management, development, construction, investing, leasing, zoning,
taxes, title, economics, and law. Most have a real estate license
Title Insurance - Answer-A person who is very good at performing simple accounting
procedures and preparing closing statements and has an outgoing personality could
be an excellent escrow offer. One who is one inclined to the technical side, research,
or document review could be a title examiner
Full-Time Investor - Answer-Purchase,inexpensive lay and with a low down payment,
a small apartment building that has not been well maintained but is in a god
neighborhood. The property is then thoroughly reconditioned and rents are raised.
Research and Education - Answer-Can concentrate on such matters as improved
construction materials and management methods, or on finding answers to
, economics questions such as "What is the demand for homes going to be next year
in this community (state, country)?"
Education Standard Advisory Committee (ESAC) - Answer-To regularly review and
revise curriculum standards, course content requirements, and instructor certification
requirements for core and Continuing Education (CE) courses. Committee consists
of:
*Seven members who have been engaged in the practice of real estate for at least
five years before appointment and who are actively engaged in that practice
* Four members who are real estate instructors or owners of real estate schools
accredited by TREC that provide core or continuing education
* One member who represents the public
The long-term goals for this group include reviewing the following:
* All core curriculum content
* Course fees and approval processes
* The acceptability of the various course delivery methodologies (such as classroom,
correspondence, alternative delivery, and combination delivery courses)
* Alternative evaluation methods of student mastery (other than examinations)
* Provider qualifications
* Instructor qualification standards, including both delivery and mastery
Real estate (or real property) - Answer-Land and the improvements made to land as
well as the rights to use them
Realty - Answer-Refers to land and buildings and other improvements from a
physical standpoint
Real Property - Answer-Refers to land and improvements both on and to the land,
and also to the physical aspects of real estate, including surface, air and subsurface
rights plus, bundle of rights.
Land - Answer-Starts. At the center of the earth, passes through the earth's surface,
and continues on into space
Improvements - Answer-Any form of land development, such as buildings, roads,
fences and pipelines
Personal Property (or personality) - Answer-A right or interest in things of a
temporary nature; Items that are not a part of the land, such as tables, chairs, beds,
desks, automobiles, farm machinery, and the like
Fixtures - Answer-An object that has been attached to land so as to become real
estate: is the property of the landowner, and when the land is conveyed to a new
owner, it is automatically included with the land
Tests of a Fixture - Answer-1. Method of annexation of the real estate
2. Fitness or adaptation to a particular use of the premises
3. The intention of the parties
