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NC Real Estate Exam > Chapter 1 > Flashcards

Chapter 1 Flashcards

1
Q

Situs

A

Takes into account Societal & Economic factors of where the land is located.
Most important economic factor in real estate
Society & Economics

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2
Q

Permanence of Investment

A 
Court Order
Party harmed by breach of RE Contract
Judge forces breaching party to pay monetary damages
Physical Characteristic of land
Doctrine of Specific Performance
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3
Q

Heterogenity & Non Homogeneity

A

No 2 parcels are alike
Both words mean the same thing
Unique

Ex: House/lot differences

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4
Q

Bill of Sale

A

Document used to transfer personal property

ex: Receipt

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5
Q

Title

A

Title = Ownership

Receipt of a Title = Deed

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6
Q

Supply & Demand

A

Supply increases = Price decreases

Demand increases = Price increases

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7
Q

Scarcity

A

Short Supply in comparison with demand

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8
Q

Real Estate Cycles

A 
The cycle of Real Estate: E R D R
E - Expansion
R - Recession
D - Depression
R-  Revival
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9
Q

Personal Property

A

aka - Chattel or Personalty
Readily Moveable or things you can take when you move

-Shake the house upside down, whatever comes out you can take
Ex: Couch, lamp, washer/dryer

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10
Q

NCREC Disciplinary Actions

A
  1. Reprimand
  2. Revoke
  3. Suspend
  4. Censure
    * CANNOT GIVE FINES*
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11
Q

Who is eligible to take the course and get licensed?

A
  1. 18 years or older
  2. US Citizen
  3. SSN
  4. No formal education needed (not even HS)
  5. Pass a background check
  6. Committed to challenging course
  7. NCREC requires contract (our registration for this course)
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12
Q

Fructus Industriales

A

Personal Property
Fruits of the the tree, but not the actual tree
Annual Crops

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13
Q

5 Categories of Real Estate

A
  1. Residential (1-4 units)
  2. Commercial
  3. Industrial
  4. Agricultural
  5. Special Purpose (Funeral Home)
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14
Q

Real Estate

A

Artificially Attached

Land, buildings, sheds, Fences

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15
Q

Land

A

Immobile & Indestructible

Earth’s Surface
Downward to the center of the earth upward to heaven

FFA has access through for air space

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16
Q

North Carolina Real Estate Commission

A

NCREC: 9 members duty is to protect & promote interest of the Public, they create rules & regs

7 appointed by the Government
2 appointed by Legislative

3 must hold RE licenses
2 must be lay people

Chair selected by the Commission

17
Q

Realtor vs. Broker

A

Realtor: Trade organization member (you do not have to join)

Broker: Real Estate Brokers License holder

Must be a Broker to become a Realtor

18
Q

Provision Broker

A
  1. Supervised by BIC
  2. Needs to complete post licensing education

complete courses 301, 302 & 303 within 18 months of passing exam
You are considered Active if:

  1. Completed all Continuing Education (CE)
  2. Renewed your license annual $45
  3. Affiliated with a BIC

If not all of those 3 things are a yes, you are inactive

19
Q

Full Broker

A
  1. Complete all of your CE (301,302 & 303)
  2. Renewed your license annual $45

You no longer need BIC Supervision

If not all of those things are a yes, you are inactive

20
Q

BIC Eligible

A

Has met the requirements to become a BIC but is not actively serving as a BIC

aka Vice President

21
Q

BIC

A

Broker in Charge (pronounced like Bic pen)

Supervises the entire office

aka Head honcho, President

22
Q

4 North Carolina License Status’

A
  1. Provisional Broker
  2. Full Broker
  3. BIC Eligible
  4. BIC
23
Q

When is a Real Estate License required?

A

MUST BE ALL 3:

  1. It is a Real Estate activity: LL BEANS
    List, Lease, Buy, Exchange, Auction, Negotiate & Sell
  2. For someone else other than yourself
  3. Getting Paid

Exceptions:

  1. Salaried employees of a broker/developer/owner of the property.
    1a. Unlicensed RE assistants CAN NOT show a property for sale, only rentals
  2. An attorney providing a legal service (ex: probate estate)
24
Q

Rate of Return (ROR)

A

The % of the net income produced by a property or another investment

Net = AFTER TAXES

25
Q

Appreciation

A

An increase in property value

26
Q

Inflation

A

The Purchase price of goods changes over time & typically grows 1-2% annually.

ex: Milk 1920’s = $0.20. Milk 2020 = $3.50

27
Q

Appurtenance

A

Any right or privilege that is considered to run w/ the land. Not all rights and privileges run w/ the land, must be perusal in nature.

Ex: Municipal water & sewer lines: it is the right and privilege that the government has to place the pipes to provide utility services.

28
Q

Land Use Controls

A
  1. Public
  2. Private
  3. Government
29
Q

Highest & Best Use

A

Physical & Economic factors affecting the land that provide:

  1. The GREATEST return
  2. Maximizes the value of Real Estate
  3. Must be a use feasible future use

Ex: Transportation, Resources, Zoning, Elevation & Contour (shape of the land)

30
Q

Protective Covenants

A

An agreement restricting specified financial transactions.

Ex: a loan agreement states that a person may not borrow money from another lender against certain collateralized property.

31
Q

Immobility

A

Physical Characteristic that is impossible to move or relocate. B/c of the immobility, the value of the piece of RE is directly affected by its surroundings.

Ex: Land

32
Q

Indestructible

A

A Permanence of land

33
Q

What is the single most important economic characteristic of land?

A

Location

34
Q

What increase in economic supply of land?

A
  1. Increased utilization of the physical supply of land
  2. Modification of improvements to the land
  3. High density development
35
Q

Restrictive Covenants

A
  1. A clause in a deed or lease to real property that limits what the owner of the land or lease can do w/ the property.
  2. It allows surrounding property owners w/ similar covenants in their deeds to enforce the terms of covenants in a court of law.
36
Q

What are physical characteristics of land?

A
  1. NonHomogeneity
  2. Permanence
  3. Immobility
  4. Indestructibility
37
Q

What are public land use restrictions?

A
  1. Building Codes
  2. Zoning Laws
  3. Regional Planning
38
Q

What is a separable Ownership in land?

A

The characteristics of land that causes the RE market to be essentially a local market of its physical characteristic of immobility
Exceptions: Nonhomogeneity

NC Real Estate Exam (3 decks)

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