Chap 3: Multi-Family Housing and Subdivisions

Question 1

3.1 Which best describes the Uniform Land Sales and Practices Act (ULSPA)?

a. A Hawaii state law governing condominium sales which aims to protect the public from deceptive practices and abuses.
b. A Hawaii state law which aims to protect purchasers of subdivided vacant lots from deceptive practices and abuses.
c. A federal law regulating subdivision sales.
d. A law protecting purchasers of new homes in large neighborhoods from unfair and abusive developers.

Answer 1

b. A Hawaii state law which aims to protect purchasers of subdivided vacant lots from deceptive practices and abuses.

ANSWER: B

Question 2

3. 2 What department regulates subdivision approval in Hawaii?
   a. HUD
   b. OILSR
   c. DCCA
   d. Real Estate Commission

Answer 2

a. HUD

ANSWER: A

Question 3

3.3 What is a public offering statement?

a. A colored brochure showing the landscape and view from the subdivision.
b. A statement of assets and liabilities of the developer.
c. A prospectus of possible house plans that can be built on the site.
d. A full and accurate disclosure of all material and relevant facts concerning the subdivision.

Answer 3

d. A full and accurate disclosure of all material and relevant facts concerning the subdivision.

ANSWER: D

Question 4

3.4 How many days must the subdivider give the prospective purchaser to review the public offering statement?

a. Three
b. Five
c. Seven
d. Fourteen

Answer 4

c. Seven

ANSWER: C

Question 5

3.5 What may the Director do if the developer does not provide a public offering statement to each buyer of non-exempted subdivided land?

a. Issue a “cease and desist” order
b. Stop all sales.
c. Revoke the registration
d. All of the above.

Answer 5

d. All of the above.

ANSWER: D

Question 6

3.6 Early in the process of developing a condominium the Commission will examine the project and issue:

a. A Feasibility study
b. A statement of written commitment.
c. An effective date for the public report.
d. A notification of intention.

Answer 6

c. An effective date for the public report.

ANSWER: C

Question 7

3.7 The declaration of a condominium development would contain all BUT:

a. A description of the land on which it is to be built.
b. The names of the board of directors of the owners association.
c. A description of the limited common elements.
d. The percentage of undivided interest in the common elements appurtenant to each apartment.

Answer 7

b. The names of the board of directors of the owners association.

ANSWER: B

Question 8

3.8 Regarding condominiums under HRS 514B:

a. Parking stalls are deeded to the unit owner.
b. Liens may attach to common elements.
c. The land is considered a limited common element.
d. Owners have equal rights to usage of the common elements.

Answer 8

d. Owners have equal rights to usage of the common elements.

ANSWER: D

Question 9

3. 9 If Sally purchases a “vacation license”, she is buying a:
   a. Leasehold Condominium
   b. Fee Simple Condominium
   c. Boat slip in a harbor
   d. Time Share unit

Answer 9

d. Time Share unit

ANSWER: D

Question 10

3. 10 An individual owner in a condominium can normally:
   a. File a suit for partition of the common elements.
   b. Exempt herself from paying part of the common expenses by waiving or abandoning her use or enjoyment of a particular common element.
   c. Attend annual owners association meetings
   d. Attend and participate in board of directors executive sessions.

Answer 10

c. Attend annual owners association meetings

ANSWER: C

Question 11

3. 11 According to time share law, an exchange agent is a person who:
   a. sells real estate
   b. handles tax-free exchanges
   c. operates an exchange program
   d. manages a time share plan

Answer 11

c. operates an exchange program

ANSWER: C

Question 12

3.12 Which is true of timeshare acquisition agents who are not licensed as sales persons?

a. They must be licensed as a real estate salesperson or broker.
b. They are not required to work under the supervision of a broker.
c. They must be registered with the Commission as a time share acquisition agent.
d. They must confine their solicitation activities to an area no more than 10 feet from the front of their booths.

Answer 12

c. They must be registered with the Commission as a time share acquisition agent.

ANSWER: C

Question 13

3. 13 The time share 7 day right of recession:
   a. is a mutual right to cancel by either buyer or seller.
   b. is a unilateral right to cancel by the buyer.
   c. is a unilateral right to cancel by the seller.
   d. may be exercised by either party orally or in writing

Answer 13

b. is a unilateral right to cancel by the buyer.

ANSWER: B

Question 14

3. 15 An example of a limited common element in a condominium might be:
   a. a swimming pool
   b. a parking stall
   c. the walkway along the row of ground floor units.
   d. a snack shop in the lobby

Answer 14

b. a parking stall

ANSWER: B

Question 15

3.16 Unless otherwise stated in the declaration or bylaws, common profits are:

a. retained by the condominium board of directors against future projected expenses.
b. distributed to the unit owners according to their individual usage of the common elements.
c. distributed to the unit owners in proportion to the common interest appurtenant to their respective units.
d. none of the above

Answer 15

c. distributed to the unit owners in proportion to the common interest appurtenant to their respective units.

ANSWER: C

Question 16

3.17 A project may be removed from the CPR by:

a. majority vote of the board of directors
b. majority vote of the unit owners
c. agreement of the unit owners of 80% of the common interest.
d. Once admitted to the CPR, there is no method of removal.

Answer 16

c. agreement of the unit owners of 80% of the common interest.

ANSWER: C

Question 17

3. 18 Which of the following is true regarding condominiums?
   a. The provisions of the house rules apply to owner-occupants but not tenants.
   b. Real property taxes are assessed on the entire project and prorated according to each unit owner’s percent of common interest.
   c. A homeowner exemption on real property taxes is not available on condominiums.
   d. Individual unit owners may insure their units separately.

Answer 17

d. Individual unit owners may insure their units separately.

ANSWER: D

Question 18

3.19 Ownership of a cooperative apartment is by way of:

a. an assignment of lease
b. a proprietary lease
c. a lease for years
d. a general warranty deed

Answer 18

b. a proprietary lease

ANSWER: B

Question 19

3. 20 One feature of ownership shared by condominiums and co-op is:
   a. Ownership of the land itself may be leasehold or fee simple.
   b. Title to the property is taken in the name of a corporation.
   c. individual ownership of a unit is taken by way of shares in a corporation
   d. ownership of a unit is technically ownership of personal property.

Answer 19

a. Ownership of the land itself may be leasehold or fee simple.

ANSWER: A

Question 20

3. 21 Which of the following best describes Planned Development Housing? (aka P.U.D.)
   a. A higher density development with smaller lots, closer dwellings and recreational space set aside for the use of all owners and tenants.
   b. Large home sites set aside for estate-type homes, with a dedicated recreation center.
   c. Golf course developments with membership open only to homeowners and their tenants.
   d. None of the above.

Answer 20

a. A higher density development with smaller lots, closer dwellings and recreational space set aside for the use of all owners and tenants.

ANSWER: A

Question 21

3. 22 The members of a board of directors of a condominium and a real estate licensee have the following in common:
   a. They are both responsible for the overall fiscal well being of their association or principal.
   b. They are both empowered to make major decisions on behalf of their association or principal.
   c. Both must be licensed in order to carry out their duties.
   d. They both have a fiduciary duty to their association or principal.

Answer 21

d. They both have a fiduciary duty to their association or principal.

ANSWER: D

Question 22

3. 23 When a leasehold condominium is converted to fee simple land ownership:
   a. The owner/lessor of the land must first offer the association a first right of refusal to buy the fee simple interest.
   b. The association has 120 days to accept or reject the offer.
   c. Seventy-five percent of the unit owners must vote to approve the purchase.
   d. All of the above.

Answer 22

d. All of the above.

ANSWER: D

Question 23

3. 24 When converting an existing rental property to a condominium:
   a. The existing tenants must be given the first right of refusal to purchase their units in fee simple.
   b. The existing tenants have the first right of refusal only if they are current on their rent payments.
   c. Under the anti-discrimination laws, the tenants have no greater rights than the general public to purchase the units.
   d. None of the above

Answer 23

a. The existing tenants must be given the first right of refusal to purchase their units in fee simple.

ANSWER: A

Question 24

3.25. According to time share law, when a prospect is given a gift to induce him to attend a time share presentation, the presenter must give the gift to the prospect

a. at the time the prospect signs up to attend the presentation
b. prior to or at the beginning of the presentation
c. during the presentation
d. at the end of the presentation

Answer 24

b. prior to or at the beginning of the presentation

Question 25

3.14. The time share 7 day right of recession must be:
a. Written
B. Oral
C. Clearly stated
D all of the above

Answer 25

D. All of the above