Real Estate Exam.txt

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Real Estate Exam.txt
2012-08-03 09:10:10
Real Estate Exam Indiana

Indiana Real Estate Exam
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  1. Supply & Demand
    When supply increase and demand is stable, prices go down. When Demand increases and supply remains stable, prices go up.
  2. Uniqueness
    No matter how similar two parcels of real state may appear, they are never EXACTLY alike. Characteristic of real estate that governs the way market reacts to supply and demand.
  3. Immobility
    Property cannot be relocated to satisfy demand where supply is low. Characteristic of real estate that governs the way market reacts to supply and demand.
  4. Local Markets
    Market where real estate professionals practice. Expanded with technology.
  5. Factors Affecting Supply
    • Labor Force
    • Availability of skilled labor to build.
    • Low = Higher Price Construction Costs
    • Materials, fees, labor costs, etc.

    • Government Controls
    • Fees, Taxes, Regulation Government Financial Policies

    Financial controls (Federal Reserve, Prime Rate, etc.)
  6. Federal Reserve Board
    Establishes DISCOUNT RATE, which is the rate of interest for the money it lends to banks. Affects lending interest rates.
  7. FHA
    Federal Housing Administration, which insures and guarantees loans.
  8. VA
    Department of Veteran Affairs, which insures and guarantees loans.
  9. Factors Affecting Demand
    • Population
    • Total population density of an area.

    • Demographics
    • Family size, age, income, lifestyle, etc. Employment and Wage Levels

    Economic factors, etc.
  10. Brokerage
    The business of bringing people together in a real estate transaction.
  11. Appraisal
    The process of estimating a property's market value based on established methods and the appraiser's professional judgment.
  12. Property Management
    A person or company hired to maintain and manage property on behalf of its owner.
  13. Financing
    The business of providing the funds that make real estate transactions possible.
  14. Subdivision
    The splitting of a single property into smaller parcels.
  15. Development
    Involves the construction of improvements on the land.
  16. Home Inspection
    A profession that conducts a thorough visual survey of a property's structure, systems, and site conditions and prepares an analytical report that is valuable to both purchasers and homeowners. Must be licensed.
  17. Auctioning
    Buying or selling real estate using an open and competitive bidding process to transfer property.
  18. Realtor
    A member of the Association of Realtors.
  19. NAR
    National Association of Realtors
  20. (REBAC)
    Real Estate Buyer's Agent Council - Professional Association
  21. (NAEBA)
    National Association of Exclusive Buyers Agents - Professional Association
  22. (BOMA)
    Building Owners and Managers Association - Professional Association
  23. Five Categories of Real Property
    1.) Residential - All property used for single-family or multifamily housing, weather in urban, suburban, or rural areas.

    2.) Commercial - Business property, including office space, shopping centers, stores, theaters, hotels, and parking facilities.

    3.) Industrial - Warehouses, factories, land in industrial districts, and power plants.

    4.) Agricultural - Farms, timberland, ranches, and orchards.

    5.) Special Purpose - Churches, schools, cemeteries, and government-held lands.
  24. Appurtenance
    A right, privilege, or improvement belonging to and passing with, the land, such as a parking space or lake access rights.
  25. Bundle of Legal Rights
    The concept of land ownership that includes all legal rights to the land.

    • These rights include:
    • - Right to Possession
    • - Right to Control the Property
    • - Right of Enjoyment
    • - Right of Exclusion
    • - Right of Disposition
  26. Fixture
    Personal property that has been so affixed to the land or building that by law, it becomes part of the real property.
  27. Three Legal Tests for Fixtures
    Method of Attachment, Adaptation to Real Estate, Agreement
  28. Land
    The earth's surface extending downward to the center of the earth and upward to infinity. Includes permanent natural objects such as trees.
  29. Personal Property
    All property that can be owned and that does not fit the definition of real property. Typically movable.
  30. Personalty
    Another term for Personal Property.
  31. Chattel
    Another term for Personal Property.
  32. Emblements
    Annually cultivated crops. Generally considered Personal Property.
  33. Real Estate
    Land at, above, and below the earth's surface, plus all things permanently attached to it. Attachments may be natural or artificial, such as buildings.
  34. Four Economic Characteristics of Real Estate
    • 1.) Scarcity
    • 2.)¬†Improvements
    • 3.) Permanence of Investment
    • 4.) Location (most important)
  35. Three Physical Characteristics of Land
    • 1.) Immobility
    • 2.) Indestructibility
    • 3.) Uniqueness
  36. Economic Characteristics of Land
    Scarcity, Improvements, Permanence of Investment, Location/Area Preference/Situs
  37. Real Property
    The interests, benefits and rights that are automatically included in the ownership of land and real estate.
  38. Severance
    Transferring Real Property into Personal Property (cutting down a tree for firewood).
  39. Annexation
    Changing Personal Property into Real Property, such as pouring concrete and it dries into a walkway.
  40. Deed
    A written instrument that, when executed and delivered, conveys title to or an interest in real estate.
  41. Bill of Sale
    A legal document that transfers personal property.
  42. Situs
    The personal preference of people for one area over another.
  43. *Trade Fixture
    An article installed by a tenant under the terms of a lease and removable by the tenant before the lease expires. An example might be an oven in a leased restaurant space.
  44. Accession
    Acquiring title to additions or improvement to real property as a result of the annexation of fixtures or the accretion of alluvial deposits along the banks of streams.