Chapter 12 Property Management

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Chapter 12 Property Management
2013-11-06 20:13:23
NC Real Estate Exam

Modern Real Estate Practices in NC 8th Edition
Show Answers:

  1. (T/F) A property's managers primary function is to preserve the value of an owner's investment property while generating income for the owner.
  2. (T/F) A property manager is usually considered to be a special agent
    False, general agent
  3. (T/F) A property manager who is the owners agent must have an active provisional real estate broker's license.
  4. (T/F) All property management agreements must be in writing before the first tenant is contracted.
    False, must be in writing from its inception.
  5. Operating Budget
    the projection of income and expense for the operation of a property over a one-year period.
  6. Cash flow report
    a monthly statement that details the financial status of the property.
  7. Potential gross income
    includes potential gross rentals if 100 percent occupied and collected
  8. Effective gross income
    deducts vacancy and collection losses
  9. Fixed vs. Variable expenses
    fixed remain constant and do not change, variable may be recurring or nonrecurring and can include repairs and landscaping.
  10. Profit and Loss Statement
    a financial picture of the revenues and expenses used to determine whether the business has made money or suffered a loss.  Does not include itemized information.
  11. Budget comparison statement
    compares the actual results with the original budget.
  12. (T/F) A low vacancy rate could mean that the rates are too low.
  13. (T/F) In NC, property managers deposit funds into trust accounts by mandated deadlines and maintain detailed and accurate trust account records.
  14. Preventive Maintenance
    Helps prevent problems and expenses
  15. Corrective Maintenance
    Corrects problems after they've occurred
  16. Title III of the ADA
    prohibits discrimination in commercial properties and public accommodations
  17. Consequential Loss Insurance
    covers the loss of revenue if the property can not be used.
  18. Liability Insurance
    Covers injuries due to negligence
  19. Casualty Insurance
    coverage against theft, burglary, vandalism, and machinery damage
  20. Surety Bonds
    cover an owner against financial losses resulting from an employee's criminal acts or negligence
  21. Risk Management (ACTOR)
    Avoid, Control, Transfer, or Retain