Chapter 12 Flashcards

(17 cards)

0
Q

This agreement creates agency relationship between the owner and the property manager

A

Property management agreement

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1
Q

Someone who preserves the value of an investment property while generating income as an agent to for the owner

A

Property manager

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2
Q

Property management begins with the management plan prepared by the property manager (3)

A

1) the owner’s objectives
2) the regional and neighborhood market analysis
3) the specific property analysis

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3
Q

A monthly statement that details the financial status of property

A

Cash flow report

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4
Q

The amount of rental income the property could produce with a 100 percent occupancy with all tenants paying rent ; also called schedule gross income

A

Potential gross income

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5
Q

The amount of income lost due to empty units or tenants not paying full rent

A

Vacancy and collection losses

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6
Q

The anticipated income from rental property resulting from potential gross income minus an allowance for vacancy and bad debts

A

Effective gross income

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7
Q

The net spendable income from an investment determined by deducting all operating and fixed expenses from the gross income when expenses exceed income a negative _____ results

A

Cash flow

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8
Q

Periodic and necessary expenses essential to the continuous operation and maintenance of an income property

A

Operating expenses

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9
Q

A financial picture of the revenues and expenses used to determine whether the business has made money or suffered a loss

A

Profit and loss statement

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10
Q

Compares the actual results with the original budget often given either percentages or a numerical variance of actual versus projected income and expenses

A

Budget comparison statement

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11
Q

The statement of proposed rental rates determined by the owner or property manager or both based on a building’s estimated expenses market supply and demand and the owners long-range goals for the property

A

Rental schedule

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12
Q

Helps prevent problems and expenses

A

Preventive maintenance

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13
Q

Corrects problems after they’ve occurred

A

Corrective maintenance

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14
Q

Property maintenance encompasses what 4 areas?

A

1) preventive maintenance
2) repair or corrective maintenance
3) routine maintenance and cleaning
4) construction

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15
Q

4 steps to handling risk?

A

Avoid it
Retain it
Control it
Transfer it

16
Q

The income projected for an income producing property after deducting losses from vacancy and collection and operating expense

A

Net operating income